Kansas Casino Market Study Task1 – Estimates of gaming revenues for a generic casino to be located in each of the four gaming zones Final Report

Prepared For: Kansas Lottery Gaming Facility Review Board

May 26, 2008 Prepared By: Wells Gaming Research 495 Apple Street, Suite 205 Reno, NV 89502 775-826-3232 http://www.wellsgaming.com Kansas Casino Market Study & Gaming Revenue Projections

Table of Contents

Page: Section 1: Introduction & Executive Summary Introduction 1-1 Research Methodology & Scope of Work 1-3 Map - Geographical Trade Areas for the Gaming Zones 1-4 Summary of the Research Results for Kansas 1-6 Limiting Conditions 1-11

Section 2: Northeast Gaming Zone Summary of the Trade Area 2-1 Map - Northeast Trade Area 2-2 Detailed Report for the Northeast Gaming Zone Trade Area 2-7 Status Quo for the Northeast Trade Area 2-10 Status Quo Gaming Capacity 2-12 Analysis of Gaming Revenue Scenarios 2-13

Section 3: Southeast Gaming Zone Summary for the Trade Area 3-1 Map - Southeast Trade Area 3-3 Detailed Analyses for the Trade Area for the Southeast Gaming Zone 3-8 2007 Status Quo for the Southeast Trade Area 3-12 Status Quo Casino Capacity 3-14 Scenario Results for the Southeast Casino Zone Trade Area (Revenue Forecasts) 3-16

Section 4: South Central Gaming Zone Summary of the Trade Area 4-1 Map - South Central Trade Area 4-2 Detailed Analysis of the Trade Area for the South Central Gaming Zone 4-6 Status Quo for the South Central Trade Area 4-9 Current Casino Gaming Capacity for the South Central Trade Area 4-11 Analyses of the Gaming Revenue Scenarios 4-13

Section 5: Southwest Gaming Zone Summary of the Trade Area 5-1 Map - Southwest Trade Area 5-2 Detailed Analyses for the Trade Area for the Southwest Gaming Zone 5-6 Status Quo Casino Revenues & Visitors for the Southwest Zone's Trade Area 5-8 Status Quo Estimates of Casino Revenue Flows 5-9 Status Quo Southwest Trade Area Capacity 5-10 Future Capacity with Casino Growth 5-10 Scenario Analyses for the Southwest Trade Area (Revenue Forecasts) 5-11

Section 6: Wells Gaming Research Company Information Services Offered & Richard H. Wells, Experience & Qualifications 6-1

Wells Gaming Research May 2008 Kansas Casino Market Study & Gaming Revenue Projections

Section 1

Wells Gaming Research May 2008 Kansas Casino Market Study & Gaming Revenue Projections

Introduction

The State of Kansas has lost gaming revenues for many years to a number of surrounding states, particularly to Missouri and Oklahoma. The recent development of numerous tribal casinos in Oklahoma exacerbated the problem. In an effort to stem the flow of gaming revenues and related taxes, Kansas’ legislators passed Senate Bill 66 (the Kansas Expanded Lottery Act), which legalized casino gaming. SB 66 was signed by the governor in 2007.

Key Provisions of Senate Bill 66 Some key provisions of SB 66 that pertain to this study include:

1. Establishment of four casino gaming zones: • Northeast (located in Wyandotte County) • Southeast (located in Crawford and Cherokee Counties) • South Central (located in Sumner and Sedgwick Counties) • Southwest (located in Ford County)

2. Building one state owned casino in each of the four Kansas gaming zones listed above.

3. Permitting an aggregate of 2,800 slot machines to be installed at the three existing racetracks.

Senate Bill 66 required the counties located within the four subject gaming zones to hold referendum elections for the purpose of either approving or disapproving casino gaming, or slot machines to be located at their respective racetracks. Three gaming zones have racetracks (northeast, southeast, and south central). However, Sedgwick County, located in the south central gaming zone, rejected gaming in their referendum election. As a result, slot machines will be limited to two Kansas racetracks: Woodlands Race Track located in the Kansas City, Kansas (northeast gaming zone), and Camptown Greyhound Park (closed since November 2000) located near Frontenac, Kansas (southeast gaming zone).

The Kansas Lottery Commission has appointed an independent Lottery Gaming Facility Review Board to review all of the gaming applications and select the best ones. The Board has engaged a number of outside consulting firms to help with the reviewing process. To date, six gaming applications have been received for the northeast zone, one for the southeast zone, four for the south central zone, and two for the southwest zone. The applicants that are selected will be contract managers of the gaming facilities acting on behalf of the Kansas Lottery Commission. As planned, the state will own and/or control the gaming portion of the facilities. However, the lottery will select a contract manager who will manage the gaming. The contract managers that are selected will fund, build, and operate all of the facilities under contract with the state lottery.

The contract managers will also be required to pay the following taxes that are all based on a percentage of casino gaming revenues:

May 2008 Wells Gaming Research Page 1-1 Kansas Casino Market Study & Gaming Revenue Projections

• The lottery facility would pay a minimum of 22% of gaming revenues to the state plus an additional 2% to fund programs for problem gamblers and gaming addictions issues.

• If a lottery gaming facility were located in either the northeast or southwest gaming zones, but not in a city, the gaming facility would be required to pay an additional 3% of gaming revenues to the county where the gaming facility was located.

• If, on the other hand, the gaming facility were located in a city, the facility would pay 1.5% of gaming revenues to the city and 1.5% to the county.

• If the lottery gaming facility were located in either the southeast or the south central gaming zone, but not in a city, the gaming facility would pay 2% of gaming revenues to the county in which the facility were located, and an additional 1% to the other county in the gaming zone (each gaming zone has two counties).

• If a gaming facility were located in a city, a combined tax equal to 3% of gaming revenues would be paid to the city (1%), to the county in which the facility were located (1%), and to the second county in the gaming zone (1%).

These state owned casinos are unique and will be the first state owned casinos in the US.

Assessment of the Kansas Gaming Revenue Potential Before enactment of Senate Bill 66 (the Kansas Expanded Lottery Act), the Kansas Lottery Commission engaged Christensen Capital to update their study addressing the gaming revenue potential for the four Kansas gaming zones. The updated study was released in March of 2008.

To verify the gaming revenue potential, the Kansas Lottery Gaming Facility Review Board has engaged a team of casino gaming consultants including Wells Gaming Research (WGR) and Cummings & Associates. Both WGR and Cummings were engaged to conduct independent evaluations of the gaming revenue potential as stated in Task 1 of the work assignment. In essence, Task 1 requires a market analysis of each of the gaming zones in Kansas that have been authorized for casino gaming. This involved estimating the gross gaming revenues potential for a generic casino (not associated with any of the proposals) to be located in each of the gaming zones, and projecting the potential revenue generation for the State of Kansas. The results of studies conducted by WGR and Cummings will be compared with the Christensen Study that was commissioned by the Lottery.

In compliance with the Kansas Lottery Gaming Facility Review Board’s Task 1 assignment, WGR has conducted an independent assessment of the gaming revenue potential of the four gaming zones. WGR’s work has been conducted totally independent of the work performed by either Cummings or Christensen.

May 2008 Wells Gaming Research Page 1-2 Kansas Casino Market Study & Gaming Revenue Projections

Research Methodology & Scope of Work To assess the gaming revenue potential of the four Kansas gaming zones, Wells Gaming Research utilized its proprietary gravity modeling system to developed gravity models for each of the subject gaming zones. Each gravity model was customized to reflect the market conditions of the respective gaming zone.

The geographical trade areas for the gaming zones are illustrated by the circles on the map on page 1-4. The trade area boundaries for each of the gaming zones extend approximately 100 miles from the proposed casino sites. Some degree of overlap does occur between the boundaries of the gaming zones. The casinos proposed for Kansas, together with the two racetracks (the Woodlands in Wyandotte County, and Camptown Greyhound Park in Crawford County) have been plotted on the map. Also shown are the existing casinos with which the new Kansas gaming facilities will be competing.

Three key definitions used in the discussions include:

• Gaming Zone - includes the two counties where Kansas Senate Bill 66 has authorized casinos for each zone.

• Trade Area – encompasses the area within an approximate 100-mile radius of the generic casino sites. The trade areas for the casino sites can extend into the neighboring states of Oklahoma, Arkansas, Missouri, and to a limited extend to Nebraska and Texas.

• Competitive Market - includes the approximate 150-mile region surrounding a casino site where competitor casinos vie for players living within a 150-mile radius.

Key elements WGR’s research and analyses included, but were not limited to, the following:

• Detailed population data was obtained from the Bureau of Business & Economic Research, University of Nevada, Reno at the census tract level for 2000 through 2012.

• The casino gaming capacities and amenities for existing casinos, expansions, and proposed/planned casinos located within a 150-mile radius of the four casino development sites were incorporated into the respective gravity models for each casino site.

• Size, scope, and location assumptions were developed for the each of the four proposed casinos and the two racetracks.

• The status quo period is 2007. Thus, statistics from 2007 were used to develop a baseline case for each of the four gaming zones.

May 2008 Wells Gaming Research Page 1-3 Kansas Lottery Project

0 mi 50 100 150 200 250 Copyright © and (P) 1988Ð2006 Microsoft Corporation and/or its suppliers. All rights reserved. http://www.microsoft.com/mappoint/ Portions © 1990Ð2005 InstallShield Software Corporation. All rights reserved. Certain mapping and direction data © 2005 NAVTEQ. All rights reserved. The Data for areas of Canada includes information taken with permission from Canadian authorities, including: © Her Majesty the Queen in Right of Canada, © Queen's Printer for Ontario. NAVTEQ and NAVTEQ ON BOARD are trademarks of NAVTEQ. © 2005 Tele Atlas North America, Inc. All rights reserved. Tele Atlas and Tele Atlas North America are trademarks of Tele Atlas, Inc. Kansas Casino Market Study & Gaming Revenue Projections

• Current gaming revenues were projected for each of the gaming zones (gaming revenues as they existed before any new casinos or expansions were built). In addition to the baseline cases, WGR developed three primary scenarios per zone to forecast gaming revenues.

Scenario-1 projected gaming revenue for the new Kansas Lottery Casino facility as if it were the only new casino to be built in the gaming zone.

Scenario-2 included scenario-1 plus any proposed/planned casino expansions for the gaming zone.

Scenario-3 included scenario-2 plus any new casinos that were planned/proposed for the gaming zone.

• Three gaming revenue projections (low, mid, and high cases) were developed for each scenario for the 2008 through 2012 period. WGR believes that three projection cases encompass a reasonable performance range for casino gaming revenues. WGR prefers not to develop single point projections because forecasting casino revenues is far from an exact science. Many factors both known and unknown can cause actual performance to vary significantly from the projections.

By way of background, WGR has developed a custom, proprietary, gravity model for use in estimating gaming revenues at casinos, as well as for evaluating the impacts of increased competition on those revenues. WGR’s gravity modeling methodology has proven to be a flexible and effective tool for estimating gaming revenues for casino projects where the interplay with existing and/or proposed competing casinos could affect future gaming revenues.

The concept of gravity modeling is not new to the business world. William J. Reilly first advanced the concept of a gravity model in 1931 in his book entitled Law of Retail Gravitation. Gravity models use the principal of Isaac Newton’s law of gravity, wherein the attraction between two objects is proportional to their mass, and is inversely proportional to the square of their respective distances. Newton’s law of gravity dealt with planets, the amount of gravitational force that they exert on each other, and the effects that the forces of gravity have on their trajectory. This concept of gravitational force, or pull, can be applied to various types of problems, including business, retail, and traffic. Reilly applied the concept to retail shopping center trade area and customer attraction analysis.

May 2008 Wells Gaming Research Page 1-5 Kansas Casino Market Study & Gaming Revenue Projections

Summary of the Research Results for Kansas

To complete the Task 1 assignment, WGR developed four custom gravity models, one for each of the gaming zones in Kansas. The gravity models were specifically designed to project the gaming revenues for the trade areas surrounding the gaming zones.

Population statistics were one of the key variables used in the gravity models to project the potential casino gaming revenues for the gaming zones. Statistics were compiled for both the total and adult segments of the population to determine the size of the respective trade areas for each gaming zones. The population statistics included in this report are limited to those counties located within the specific trade areas and are not representative of the entire state. Due to the age restrictions on casino gaming, only the adult statistics were used in the gravity model’s gaming revenue projections.

Exhibit 1-1 shows a comparison of both the total and the adult populations for 2007 (status quo) relative to 2012. The data are presented by state and include the total population for 184 counties located within the trade areas of each of the four gaming zones. The total population for 2007 was approximately 7.3 million, with 7.6 million forecasted for 2012. This reflects an average compound growth rate (ACGR) of less than one percent (0.8%). The adult population segment has been projected to increase at the same rate as the total population, moving up from approximately 5.1 million in 2007 to nearly 5.3 million by 2012.

Exhibit 1-1 Total & Adult Population by State for the Gaming Zones

2007 2012 ACGR State Counties Total Adult Total Adult Adult Pop AR 8 557,719 386,322 633,954 439,056 2.6% KS 87 2,686,247 1,842,821 2,753,442 1,888,940 0.5% MO 51 2,432,987 1,709,651 2,522,479 1,772,325 0.7% NE 3 18,630 13,311 18,267 13,051 -0.4% OK 33 1,617,373 1,120,631 1,681,085 1,164,451 0.8% TX 2 12,779 8,518 13,385 8,919 0.9% Total 184 7,325,735 5,081,253 7,622,612 5,286,741 0.8%

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 1-6 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Capacity Outlook with Proposed Growth If all of the proposed expansions and new casinos were built, the accompanying capacity statistics would approximate those profiled in Exhibits 1-2.

Exhibit 1-2 Capacity by State Includes Existing, Proposed Expansions & New Casinos

Kansas Oklahoma Missouri Iowa Total Existing Casinos # of Casinos 4 65 6 1 76 # of Slots 2,790 33,178 9,748 1,100 46,816 # of Tables 65 543 300 25 933

Expansions 1 5 0 0 6 1

Proposed New Casinos # of Casinos 7 11 2 0 20 # of Slots 9,350 13,771 2,500 0 25,621 # of Tables 210 324 71 0 605 Total (Existing, New Casinos & Expansions) # of Casinos 11 76 8 1 96 # of Slots 12,140 46,949 12,248 1,100 72,437 # of Tables 275 867 371 25 1,538

Percentage Increases (Existing Versus New Casinos & Expansions) # of Casinos 175% 17% 33% 0% 26% # of Slots 335% 42% 26% 0% 55% # of Tables 323% 60% 24% 0% 65%

Footnote (1): The six expansions have not been added into the total number of casinos. Data Source: Wells Gaming Research, May 2008.

The top section of Exhibit 1-2 shows the current capacity for all of the casinos located within an approximate 150-mile radius of the four Kansas gaming zones. Currently there are 76 casinos equipped with 46,816 slot machines and 933 table games.

If all of the proposed expansions and new casinos were built, and the two racetracks installed a combined total of 1,400 slot machines (800 at the Woodlands and 600 at Camptown), the gaming capacity picture would look like the total section of Exhibit 1-2. The data shows that the number of casinos would go from 76 to 96, an increase of 20 casinos (26%). It is important to note that the six expansions have not been added into the total number of locations; however, the gaming capacity has been added. Overall, slot capacity would increase by 25,621 machines, up from 46,816 to 72,437 (55%). The number of table games would increase by 605, up from 933 to 1,538 (65%).

May 2008 Wells Gaming Research Page 1-7 Kansas Casino Market Study & Gaming Revenue Projections

Competition Strong competition already exists for the four Kansas gaming zones. The northeast zone is subject to intense competition from the Kansas City, Missouri casinos and from Tribal casinos located north of the gaming zone. In addition to being subject to strong existing competition, both the southeast and the south central zones are vulnerable to increasing competition from Oklahoma Tribal casinos, which are located to the south.

Status Quo Gaming Revenue Summary

Exhibit 1-3 profiles WGR’s status quo gaming revenues for 2007 and 2012. The gaming revenue estimates are limited to all existing casinos. None of the proposed casinos or expansions has been added.

Exhibit 1-3 Status Quo Casino Gaming Revenues for 2007 & Projections for 2012 (Stated in Millions of Dollars)

2007 2012 Coming Going Coming Going State From % To % Dif From % To % Dif IA $0 0.0% $9 0.4% $9 $0 0.0% $9 0.4% $9 AR $194 7.8% $0 0.0% -$194 $220 8.6% $0 0.0% -$220 KS $841 34.1% $148 6.0% -$693 $865 33.7% $152 5.9% -$713 MO $839 34.0% $1,009 40.9% $170 $869 33.8% $1,044 40.6% $175 NE $7 0.3% $0 0.0% -$7 $7 0.3% $0 0.0% -$7 OK $583 23.6% $1,300 52.7% $717 $605 23.6% $1,364 53.1% $759 TX $3 0.1% $0 0.0% -$3 $3 0.1% $0 0.0% -$3 Total $2,467 100.0% $2,467 100.0% $0 $2,569 100.0% $2,569 100.0% $0

Data Source: Wells Gaming Research, May 2008.

The 2007 status quo gaming revenues are illustrated on the left hand side of Exhibit 1-3. The data shows where the gaming revenues come from and where they go. Total gaming revenues were approximately $2.5 billion in 2007. The majority (92%) was generated in three states including Kansas ($841 million, 34.1%), Missouri ($839 million, 34.0%), and Oklahoma ($583 million, 24%). Of the total $2.5 billion, approximately $9.0 million (0.4%) went to Iowa, $148 million (6.0%) went to Kansas, $1.0 billion (41%) went to Missouri, and $1.3 billion (53%) went to Oklahoma. Of particular interest are the differences between the revenues that were generated in Kansas and Oklahoma versus the revenues that flowed back to these two states. For example, Kansas generated $841 million in 2007 and only retained $148 million, a negative difference of $693 million. On the other hand, Oklahoma generated $583 million in 2007, while $1.3 billion flowed back to Oklahoma for a gain of $717 million.

May 2008 Wells Gaming Research Page 1-8 Kansas Casino Market Study & Gaming Revenue Projections

The right hand side of Exhibit 1-3 shows that without the addition of new casinos or expansions within any of the states referenced, the 2012 outlook is similar to that of 2007. Total gaming revenues have been estimated at $2.6 billion (an increase of $102 million over 2007). Oklahoma has been forecasted to be the big winner generating $605 million in gaming revenues (24% of the total), while receiving $1.4 billion (53%). Kansas has been forecasted to generate $865 million (34% of the total), while retaining $152 million, for a negative difference of $713 million. Missouri has been estimated to generate $869 million (34.0%), with $1 billion flowing back to Missouri, a gain of $175 million.

Gaming Revenue Projections With Casino Expansions & New Casinos

For purposes of estimating gaming revenues for our statewide gravity model, WGR identified the competitor facilities (all known and existing casinos, together with all proposed expansions and new casinos) that were located within the 150-mile trade area of each of the four gaming zones. The results are summarized in Exhibit 1-4. The status quo gaming revenues (2007) are shown, as well as the gaming revenue forecasts for 2012. The 2012 forecasts reflect the gaming revenue levels that could be achieved if all of the proposed casino expansions and new casinos were built and were operational.

Exhibit 1-4 Casino Revenue Projections w/ New Casinos & Expansions (Stated in Millions of Dollars)

2007 2012 Coming Going Coming Going State From % To % Dif From % To % Dif

IA $0 0% $9 0% $9 $0 0% $6 0% $6 AR $194 8% $0 0% -$194 $225 8% $0 0% -$225 KS $841 34% $148 6% -$693 $936 35% $621 23% -$316 MO $839 34% $1,009 41% $170 $905 34% $837 31% -$68

NE $7 0% $0 0% -$7 $7 0% $0 0% -$7 OK $583 24% $1,300 53% $717 $609 23% $1,221 45% $612

TX $3 0% $0 0% -$3 $3 0% $0 0% -$3 Total $2,467 100% $2,467 100% $0 $2,684 100% $2,684 100% $0

Data Source: Wells Gaming Research, May 2008.

The 2007 statistics and results are the same as those presented in Exhibit 1-3, page 10.

WGR’s forecasts of the flow of casino gaming revenues for 2012 are summarized on the right hand side of Exhibit 1-4. The major states of origin for 2012 continue to be Kansas ($936 million, 35%), Missouri ($905 million, 34%), and Oklahoma ($609 million, 23%).

May 2008 Wells Gaming Research Page 1-9 Kansas Casino Market Study & Gaming Revenue Projections

Oklahoma would continue to be the biggest recipient of gaming revenues with an estimated $1.2 billion (45% of the total) flowing back. Missouri ranks second with $837 million (31%), and Kansas ranks third with $621 million (23% of the total) staying in Kansas.

The detailed analyses and results are presented in the following sections of this report for each of the four gaming zones:

• Section 2 – Northeast Trade Area & Gaming Zone • Section 3 – Southeast Trade Area & Gaming Zone • Section 4 – South Central Trade Area & Gaming Zone • Section 5 – Southwest Trade Area & Gaming Zone

May 2008 Wells Gaming Research Page 1-10 Kansas Casino Market Study & Gaming Revenue Projections

Limiting Conditions

Wells Gaming Research, subject to the following conditions, presents the results of the Kansas Casino Market Study & Gaming Revenue Projections to the Kansas Lottery Gaming Facility Review Board.

Limit of Liability The liability of Wells Gaming Research, a Nevada corporation, (hereinafter referred to as WGR) and its employees, is limited to the named Client only. No obligation or liability to any third party is foreseen. If this report is disseminated to anyone other than the Client, the Client shall make each party aware of all of the limiting conditions, assumptions, and related discussions of the assignment. If any of this data are used for limited partnerships, syndication offerings, stock offerings, or debt offerings, the Client agrees that if any legal action (including arbitration) is initiated by any lender, partner, part owner in any form of ownership, tenant, or any other person or entity against WGR or its employees, then the Client shall hold WGR and its employees completely harmless in any such action from any and all awards or settlements of any type (including but not limited to the attorney's fees and costs), regardless of the outcome(s).

Litigation Expenses In the event that Wells Gaming Research (WGR), Richard H Wells, or any WGR staff members are named as parties to a law suit or are compelled by a court to provide testimony and documents relating to WGR’s work for the Kansas Lottery Gaming Facility Review Board, Client agrees to reimburse WGR for all out-of-pocket expenses including attorney fees, deposition expenses, travel, and document production expenses required to comply with a court order or other litigation requirements. If WGR is compelled to be a witness in litigation arising from this assignment, Client will reimburse WGR at one-half (1/2) WGR’s customary billing rate for staff time required to comply with the court order.

Copies, Publication, Distribution, & Use of Report Possession of this report or any copy thereof does not carry with it the right of publication, nor may it be used for other than its intended limited purpose. The physical report(s) remain the property of WGR for use by the Client. The fee, which the Client has paid, was only for the Kansas Casino Market Study & Gaming Revenue Projections, the accompanying analytical services, and the project reporting that was provided.

This report is to be used only in its entirety. No part is to be used or displayed without the whole report.

May 2008 Wells Gaming Research Page 1-11 Kansas Casino Market Study & Gaming Revenue Projections

Except as hereinafter provided, the Client may only distribute copies of this report in its entirety to such third parties as he may select on the conditions stated herein. Selected portions of this report shall not be given to third parties without the prior written consent of WGR. Neither this report nor any part of this report may be disseminated to the public by the use of the advertising media, public relations, news, sales, or other media for public communication without the prior written consent of WGR.

Information Used No warranty is made for the accuracy of information furnished by others, the Client, his designee, or public records. The data relied upon in this report has been confirmed and/or sources thought reliable have been used. All sources and data are considered appropriate for inclusion to the best of our factual judgment and knowledge. An impractical and uneconomic expenditure of time would be required in attempting to furnish unimpeachable verification of all data in all instances.

ACCEPTANCE AND/OR USE OF THE RESULTS AND ANALYSES CONTAINED IN THIS REPORT BY THE CLIENT OR ANY THIRD PARTY CONSTITUTES ACCEPTANCE OF THE ABOVE CONDITIONS. WGR'S LIABILITY EXTENDS ONLY TO THE STATED CLIENT AND NOT TO SUBSEQUENT PARTIES OR USERS. THESE STUDY RESULTS AND ANALYSES ARE NOT REPRESENTATIONS OR GUARANTEES OF ANY SPECIFIC LEVEL OF PERFORMANCE THAT MIGHT RESULT FROM THE ADDITION OR EXPANSION OF CASINOS IN THE KANSAS GAMING MARKET.

May 2008 Wells Gaming Research Page 1-12 Kansas Casino Market Study & Gaming Revenue Projections

Section 2

Wells Gaming Research May 2008 Kansas Casino Market Study & Gaming Revenue Projections

Summary of the Trade Area for the Northeast Gaming Zone

Highlights of the market for the northeast trade area follow (refer to pages 2-7 through 2-32 for the corresponding detailed analyses and discussions).

Trade Area The northeast trade area covers the approximate 100-mile radius surrounding Kansas City. The boundaries extend to the Iowa border on the north; to Crawford County, Kansas and Vernon County, Missouri on the south; Riley County, Kansas on the west; and Saline and Cooper Counties, Missouri on the east (refer to the map on page 2-2).

Demographic Statistics The population and median household income statistics included in this report are limited to those counties included in the northeast gaming zone trade area and are not representative of the entire states of Kansas, Missouri, and Nebraska.

Exhibit 2-1 shows that the trade area for the northeast zone includes 71 counties (32 in Kansas, 36 in Missouri, and three in Nebraska). In 2007, these counties had an adult population of approximately 2.17 million. Median household incomes (MHI) ranged from a little over $40 thousand in Nebraska, to $48 thousand in Kansas, and approximately $50 thousand in Missouri.

Exhibit 2-1 Adult Population & Median Household Income (MHI)

2007 2007 2012 ACGR Adult # of Adult Adult Population MHI State Counties Population MHI Population MHI 07 to 12 07 to 12 KS 32 1,014,311 $47,985 1,051,085 $56,417 0.71% 3.29% MO 36 1,146,430 $49,660 1,174,840 $56,720 0.49% 2.69% NE 3 13,311 $40,160 13,051 $49,079 -0.39% 4.09% Total 71 2,174,051 NA 2,238,976 NA 0.59% NA

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

The adult population forecasts increase from 2.17 million in 2007 to 2.24 million by 2012, or by approximately 70 thousand. The average compound growth rate for the adult population was 0.59% between 2007 and 2012. The average compound growth rate for adult population ranged from a negative 0.39% (three small counties) in Nebraska, to 0.49% in Missouri, and 0.71% in Kansas.

The median household income levels for 2012 have been forecasted at a little over $49 thousand for Nebraska, $56.4 thousand for Kansas, and $56.7 thousand in Missouri.

May 2008 Wells Gaming Research Page 2-1 Northeast Kansas Zone

0 mi 50 100 150 Copyright © and (P) 1988Ð2006 Microsoft Corporation and/or its suppliers. All rights reserved. http://www.microsoft.com/mappoint/ Portions © 1990Ð2005 InstallShield Software Corporation. All rights reserved. Certain mapping and direction data © 2005 NAVTEQ. All rights reserved. The Data for areas of Canada includes information taken with permission from Canadian authorities, including: © Her Majesty the Queen in Right of Canada, © Queen's Printer for Ontario. NAVTEQ and NAVTEQ ON BOARD are trademarks of NAVTEQ. © 2005 Tele Atlas North America, Inc. All rights reserved. Tele Atlas and Tele Atlas North America are trademarks of Tele Atlas, Inc. Kansas Casino Market Study & Gaming Revenue Projections

Between 2007 and 2012, the average compound growth rate for median household incomes ranged 2.69% in Missouri, to 3.29% in Kansas, to 4.09% in Nebraska.

Primary Market The primary market for the northeast trade area of Kansas is made-up of the six counties surrounding the casino in Wyandotte County. Exhibit 2-2 shows that the adult population was approximately 1.2 million in 2007, 55% of the total adult population in the subject trade area. Combined, the six counties located in the primary market have been projected to have an average compound growth rate of 0.7% between 2007 and 2012.

The total adult population has been forecasted at slightly over 2.2 million for 2012 (for yearly adult population details, refer Exhibit 2-7, page 2-9).

Exhibit 2-2 Adult Population for the Primary Market

# of ACGR Counties List of Counties 2007 2012 07 to 12 % 2012 Johnson County, Kansas 364,462 395,339 1.6% 32% Leavenworth, County, Kansas 49,948 51,318 0.5% 4% Wyandotte County, Kansas 101,401 98,159 -0.6% 8% Clay County, Missouri 147,253 154,829 1.0% 13% Jackson County Missouri 467,495 470,818 0.1% 38% Platte County, Missouri 59,691 64,189 1.5% 5% 6 Total of Wyandotte & Surrounding Counties 1,190,250 1,234,652 0.7% 100% Total Kansas Counties - Excluding Counties 29 Surrounding Wyandotte 498,500 506,269 0.3% Total Missouri Counties - Excluding Counties 33 Surrounding Wyandotte 471,990 485,004 0.5% 3 Total Nebraska 13,311 13,051 -0.4% 71 Total Adult Population for Trade Area 2,174,051 2,238,976 0.6%

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 2-3 Kansas Casino Market Study & Gaming Revenue Projections

Capacity Statistics & Competition Capacity statistics are a key component of gaming competition. Exhibit 2-3 shows the existing capacity, and illustrates the increases that are anticipated in the northeast trade area. The current capacity includes 18 gaming locations equipped with 16,914 slot machines, 440 table games (pit and poker), and 718 thousand square feet of casino space. Other visitor amenities include 107 thousand square feet of convention space, 1,331 hotel rooms, 52 restaurants, 17 entertainment venues, and 19,150 parking spaces.

Following is a profile of the casino capacity located within a 150-mile radius of the Wyandotte County casino site.

Exhibit 2-3 Capacity Statistics for Casinos Located within an Approximate 150 Miles Radius

Existing Expansions New (Proposed) Casinos Total % Change Capacity Casinos KS KS OK MO Capacity Above Existing # of Loc 18 1 5 1 1 25 1 39% # of Slots 16,914 500 6,050 2,000 1,200 26,664 58% # of Tables 440 0 140 45 30 655 49% Casino S.F. 717,691 0 20,000 70,000 40,000 847,691 18% Convention S.F. 106,520 0 110,000 10,000 12,000 238,520 124% # of Rooms 1,331 0 750 240 200 2,521 89% # of Restaurants 52 0 16 2 3 73 40% Entertainment 17 0 7 0 2 26 53% Parking 19,150 0 11,000 2,700 2,200 35,050 83% Footnote (1): The total number of locations is 25 (one is an expansion at an existing casino).

Data Source: Wells Gaming Research, May 2008.

The statistics show that the combined impact of casino growth within a 150-mile radius will result in a significant escalation in player capacity. Some key changes include a 44% increase in the number of gaming locations, from 18 up to 25 (one is an expansion only). The slot machine inventory will increase by 58%, from approximately 17 thousand to 27 thousand. The number of table games will increase by 49%, going from 440 to 655. The supply of hotel rooms will surge by 89%, from 1,331 to 2521, and the number of restaurants will increase by 40%, from 52 to 73.

May 2008 Wells Gaming Research Page 2-4 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Revenues Exhibit 2-4 profiles the revenue flows corresponding to the current status (2007), as well as to scenarios 1 through 3A (2012). These scenarios were developed to analyze the gaming revenue impacts of the expansions and the new casinos. The column captions from and to indicate the flow of gaming revenues. The current status reflects estimated total gaming revenues of $923 million for the northeast trade area as of 2007. The net gaming revenue loss for Kansas was $326 million. The majority, $275 million, went to Missouri, while $52 million went to Oklahoma.

The gaming revenues forecasted in scenarios 1 through 3A for 2012 were based on the assumptions set forth in each scenario. The addition of the casino in Wyandotte County is the key assumption of scenario 1. Total gaming revenues from Kansas increased from an estimated $414 million (2007) to $445 million (2012). The net impact of adding Wyandotte County increased the amount of gaming revenues retained by Kansas from $88 million to $277 million, thereby reducing the Kansas gaming revenue deficit by $158 million.

Exhibit 2-4 Summary of the 2012 Flow of Gaming Revenues (Dollars in Millions)

Current 2007 S-1 2012 S-2 2012 S-3 2012 S-3-A 2012

ST From To Dif From To Dif From To Dif From To Dif From To Dif

IA $0 $3 $3 $0 $3 $3 $0 $3 $3 $0 $3 $3 $0 $3 $3 KS $414 $88 -$326 $445 $277 -$168 $445 $277 -$168 $458 $312 -$146 $458 $325 -$133 MO $504 $779 $275 $516 $641 $126 $516 $638 $123 $527 $621 $94 $523 $601 $79 NE $5 $0 -$5 $5 $0 -$5 $5 $0 -$5 $5 $0 -$5 $5 $0 -$5 OK $0 $52 $52 $0 $45 $45 $0 $48 $48 $0 $54 $54 $0 $57 $57 Total $923 $923 $0 $966 $966 $0 $966 $966 $0 $990 $990 $0 $985 $985 $0

Data Source: Wells Gaming Research, May 2008.

Scenario 2, shown above in Exhibit 2-4, includes the existing casinos, as well as the new casino in Wyandotte County discussed in scenario 1. Scenario 2 also includes six casino expansions: one at the Sac & Fox Casino in Powhattan, Kansas, tentatively scheduled to open in March of 2008; and five expansions that are targeted to open at Oklahoma Tribal casinos between 2008 and 2009. Included are the Creek Nation Casino in Tulsa, the Cherokee Casino Resort in Catoosa, Kickapoo Casino in McLoud, the Osage Million Dollar Elm in Ponca City, and the Cherokee Casino West Siloam Springs in Watts. These Oklahoma casino expansions are too far away to trigger much change in gaming revenues for the trade area of the northeast gaming zone. No changes are projected for the gaming revenues coming from or going to Kansas. The net loss to Kansas remains at $168 million in scenario 2. However, the net gaming revenues flowing to Missouri decline by $3 million (down from

May 2008 Wells Gaming Research Page 2-5 Kansas Casino Market Study & Gaming Revenue Projections

$126 million to $123 million), while the gaming revenues flowing to Oklahoma increase by $3 million (up from $45 million to $48 million).

Scenario 3 includes the casino additions and expansions included in scenarios 1 and 2, plus 18 new proposed casinos, including the Wyandotte 7th Street Casino located in Kansas City, Kansas, a new casino in nearby Sugar Creek, Missouri, and 800 slot machines at the Woodlands Racetrack. The Wyandotte 7th Street Casino and the 18 proposed casinos are assumed to be in operation between 2008 and 2010 (refer to page 2-19 for a detailed listing). Total gaming revenues for scenario 3 have been projected at $990 million. Of the total, $458 million would come from Kansas with $312 million staying in Kansas. The net loss for Kansas would decline from $326 million (2007 current status) to $146 million (Scenario 3), or by $180 million.

Scenario 3A included scenario 3 with the exception of the Wild Rose Entertainment Casino planned for Sugar Creek, Missouri. Exhibit 2-4, page 2-5, shows the overall gaming revenues decline from $990 million (scenario 3) to $985 in (scenario 3A) reflecting the loss of the Wild Rose. However, the picture improves for Kansas. The total gaming revenues remain constant at $458 million, but the revenues staying in Kansas increase from $312 to $325 million (up $13 million without the Wild Rose, Sugar Creek casino).

May 2008 Wells Gaming Research Page 2-6 Kansas Casino Market Study & Gaming Revenue Projections

Detailed Report For Northeast Gaming Zone Trade Area

Population statistics are one of the key variables used in WGR’s gravity model. WGR compiled statistics for both the total and adult segments of the population for the northeast trade area. However, due to the age restrictions on casino gaming, only the adult statistics were used in the gravity model’s gaming revenue projections.

Total & Adult Population Statistics Exhibit 2-5 shows that the total population for the northeast trade area was approximately 3 million in 2007. Of this, 2.2 million (69.6%) were adults. The statistics show 1.0 million adults in Kansas (68.9% of the total), approximately 1.1 million in Missouri (70.3%), and over 13 thousand adults in Nebraska (71.4% of the total population included in the northeast trade area).

The total population is projected to be 3.2 million in 2012. Of the total, 2.2 million (69.6%) are adults. The split between total and adult shows over 1.1 million adults in Kansas (69.0% of the total), approximately 1.2 million in Missouri (70.2%), and over 13 thousand adults in Nebraska (71.4%).

Exhibit 2-5 Total & Adult Population Statistics

2000 Total & Adult 2007 Total & Adult 2012 Total & Adult Adult as a Adult % Adult as Adult % Adult as Adult % # of % of of Adult a % of of Adult a % of of Adult ST CO Total Adult Total Total Total Adult Total Total Total Adult Total Total KS 32 1,389,813 957,425 68.9% 46.3% 1,471,327 1,014,311 68.9% 46.7% 1,524,101 1,051,085 69.0% 46.9% MO 36 1,561,199 1,096,996 70.3% 53.0% 1,631,872 1,146,430 70.3% 52.7% 1,672,508 1,174,840 70.2% 52.5% NE 3 20,194 14,433 71.5% 0.7% 18,630 13,311 71.4% 0.6% 18,267 13,051 71.4% 0.6% TOT 71 2,971,206 2,068,854 69.6% 100.0% 3,121,829 2,174,051 69.6% 100.0% 3,214,876 2,238,976 69.6% 100.0%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research.

May 2008 Wells Gaming Research Page 2-7 Kansas Casino Market Study & Gaming Revenue Projections

Exhibit 2-6 illustrates that the total population for the six counties surrounding the casino in Wyandotte County was 1.7 million in 2007. Projections show an increase to approximately 1.8 million by 2012. Of the total, 32% would be located in Johnson County, Kansas, while 38% would be located in Jackson, Missouri. The trade area total for 2007 was 3.1 million with projections for 3.2 million by 2012. Overall, the average compound growth rate has been projected at 0.6% for the 2007 to 2012 period.

Exhibit 2-6 Total Population Statistics

# of ACGR % Pop/ Co Co Counties 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 2012 Johnson KS 451,086 514,020 522,451 531,013 539,727 548,578 557,579 566,720 1.6% 32% Leavenworth KS 68,691 71,413 71,803 72,193 72,585 72,979 73,378 73,775 0.5% 4% Wyandotte KS 157,882 152,385 151,399 150,413 149,441 148,470 147,512 146,556 -0.6% 8% Clay MO 184,006 206,957 209,136 211,339 213,564 215,813 217,845 219,896 1.0% 12% Jackson MO 654,880 664,078 664,994 665,910 666,828 667,748 668,733 669,720 0.1% 38% Platte MO 73,781 83,061 84,340 85,638 86,956 88,295 89,488 90,696 1.5% 5% 6 Total Surrounding Counties 1,590,326 1,691,914 1,704,123 1,716,506 1,729,101 1,741,883 1,754,535 1,767,363 0.7% 100% Total Kansas Counties - Excluding Surrounding 29 Counties 712,154 723,577 725,674 727,822 730,024 732,308 734,645 737,050 0.3% Total Missouri Counties - Excluding Surrounding 33 Counties 648,532 669,632 673,402 677,228 681,107 685,048 688,599 692,196 0.6% 3 Total Nebraska 20,194 18,707 18,630 18,553 18,477 18,401 18,334 18,267 -0.4% 71 Total Trade Area Pop 2,971,206 3,103,830 3,121,829 3,140,109 3,158,709 3,177,640 3,196,113 3,214,876 0.6%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research.

May 2008 Wells Gaming Research Page 2-8 Kansas Casino Market Study & Gaming Revenue Projections

The adult population was approximately 1.2 million in 2007 for the counties surrounding the casino in Wyandotte County (refer to Exhibit 2-7). Projections for 2012 indicate a minor increase to 1.23 million with 38% in Jackson County Missouri and 32% in Johnson County, Kansas. The total adult population of 2.2 million in 2007 is expected to increase to 2.24 million by 2012. Overall, the average compound growth rate has been projected at 0.6% between 2007 and 2012.

Exhibit 2-7 Adult Population Statistics

# of ACGR % Pop/ Co Counties 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 Co 2012 Johnson KS 314,676 358,581 364,462 370,431 376,520 382,689 388,966 395,339 1.6% 32% Leavenworth KS 47,782 49,676 49,948 50,217 50,490 50,764 51,042 51,318 0.5% 4% Wyandotte KS 105,745 102,067 101,401 100,741 100,090 99,447 98,798 98,159 -0.6% 8% Clay MO 129,559 145,719 147,253 148,804 150,371 151,954 153,385 154,829 1.0% 13% Jackson MO 460,385 466,851 467,495 468,139 468,784 469,431 470,124 470,818 0.1% 38% Platte MO 52,218 58,786 59,691 60,610 61,543 62,490 63,335 64,189 1.5% 5% 6 Total Surrounding Counties 1,110,365 1,181,680 1,190,250 1,198,942 1,207,798 1,216,776 1,225,649 1,234,652 0.7% 100% Total Kansas Counties - Excluding Surrounding 29 Counties 489,222 497,072 498,500 499,970 501,471 503,032 504,631 506,269 0.3% Total Missouri Counties - Excluding Surrounding 33 Counties 454,834 469,377 471,990 474,642 477,330 480,061 482,516 485,004 0.5% 3 Total Nebraska 14,433 13,366 13,311 13,256 13,201 13,146 13,098 13,051 -0.4% 71 Total Trade Area Population 2,068,854 2,161,496 2,174,051 2,186,809 2,199,800 2,213,015 2,225,895 2,238,976 0.6%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research.

Average Median Household Income Exhibit 2-8 shows that average median household income statistics for 2007 show approximately $48 thousand for Kansas, $50 thousand for Missouri, and $40 thousand for Nebraska. The median household income projections for 2012 include approximately $56 thousand for Kansas (ACGR of 3.3%), $57 thousand for Missouri (ACGR of 2.7%), and $49 thousand for Nebraska (ACGR of 4.1%).

Exhibit 2-8 Average Median Household Income Statistics

# of ACGR Co State 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 32 KS $38,336 $46,466 $47,985 $49,557 $51,184 $52,868 $54,612 $56,417 3.3% 36 MO $41,111 $48,359 $49,660 $50,998 $52,372 $53,783 $55,232 $56,720 2.7% 3 NE $30,331 $38,586 $40,160 $41,801 $43,510 $45,290 $47,145 $49,079 4.1%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research.

May 2008 Wells Gaming Research Page 2-9 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo for the Northeast Trade Area

Status Quo Casino Revenues Exhibit 2-9 shows that the status quo casino gaming revenues were $923 million for 2007 ($759 million within a 50 mile radius and approximately $164 million for other competing casinos). Without any casino expansions or additions, gaming revenues in the northeast trade area could be expected to increase to approximately $940.5 million by 2010, and to $952.2 million by 2012.

Exhibit 2-9 Revenues – 2007 Status Quo Northeast trade area

Revenue 2007 2008 2009 2010 2011 2012 Casinos w/in 50 miles $759,348,000 $764,333,000 $769,402,000 $774,557,000 $779,590,000 $784,703,000 Other Casinos Competing w/in Trade Area $163,641,400 $164,384,900 $165,140,600 $165,919,200 $166,696,800 $167,492,500 Total $922,989,400 $928,717,900 $934,542,600 $940,476,200 $946,286,800 $952,195,500

Data Sources: Wells Gaming Research, April 2008.

Status Quo Visitors Exhibit 2-10 illustrates that the status quo casino visitors for 2007 totaled approximately 14 million (11.8 million within a 50 mile radius, and approximately 2.2 million for other competing casinos). Absent any casino expansions or additions, the casino visitor counts could be expected to increase to approximately 14.4 million by 2012.

Exhibit 2-10 Casino Visitors – 2007 Status Quo Northeast trade area

Visitors 2007 2008 2009 2010 2011 2012 Casinos w/in 50 miles 11,782,925 11,858,085 11,934,550 12,012,280 12,088,190 12,165,341 Other Casinos 2,162,247 2,172,745 2,183,478 2,194,525 2,205,619 2,217,065 Total 13,945,172 14,030,830 14,118,028 14,206,805 14,293,809 14,382,406

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-10 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo Gaming Revenue Flows The status quo flow of casino revenues showing what could be expected if no new casino developments occurred are profiled in Exhibit 2-11. Focusing on 2007, an estimated $923 million in gaming revenues was generated in the northeast trade area. Of this amount, an estimated $414 million came from Kansas; however, Kansas only retained $88 million, a loss of $326 million.

If there were no casinos expansions or new casinos added, WGR estimates that $952 million could be generated in the northeast trade area by 2012. Of this amount, $431 million would come from Kansas. However, only an estimated $91 million would flow back to Kansas (a loss of over $340 million).

Exhibit 2-11 2007 Status Quo Estimates of the Casino Revenue Flows, Northeast Trade Area Illustrates Where the Gaming Revenues Originated & Where They Went

Revenues Coming From State 2007 2008 2009 2010 2011 2012 ACGR % 2012 Total KS $414,186,842 $417,457,538 $420,805,847 $424,221,045 $427,702,492 $431,254,327 0.81% 45% MO $503,538,602 $506,015,208 $508,514,591 $511,053,330 $513,397,492 $515,774,822 0.48% 54% NE $5,264,895 $5,243,332 $5,222,491 $5,200,061 $5,183,145 $5,165,162 -0.38% 1% Total $922,990,339 $928,716,078 $934,542,929 $940,474,436 $946,283,129 $952,194,311 0.62% 100%

Revenues Going To State 2007 2008 2009 2010 2011 2012 ACGR % Total IA $3,431,000 $3,442,000 $3,452,000 $3,463,000 $3,473,000 $3,484,000 0.31% 0% KS $88,459,000 $88,869,000 $89,294,000 $89,733,000 $90,185,000 $90,653,000 0.49% 10% MO $778,840,000 $783,919,000 $789,082,000 $794,332,000 $799,456,000 $804,662,000 0.65% 85% OK $52,259,400 $52,487,900 $52,714,600 $52,948,200 $53,172,800 $53,396,500 0.43% 6% Total $922,989,400 $928,717,900 $934,542,600 $940,476,200 $946,286,800 $952,195,500 0.62% 100%

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-11 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo Gaming Capacity

Gaming Capacity Exhibit 2-12 shows that 18 casinos are currently located within approximately 150 miles of the proposed casino site for the northeast zone. The combined gaming capacities is 16,914 slot machines, 367 pit table games, 73 poker tables, 868 bingo seats, one race book, and 717,691 square feet of casino space. Other amenities located at existing casinos include 106,520 square feet of convention/meeting space, 1,331 hotel rooms, 52 restaurants, 17 entertainment venues, and 19,150 parking spaces.

Exhibit 2-12 Status Quo Casino Capacity Statistics

# of # of # of Con- # of Enter- # of # of # of Pit Poker Total Bingo Race Casino vention # of Restau- tain- Park- Loc Casino Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing Iowa: 1 Terrible's Lakeside Casino 1,100 22 3 25 0 0 37,480 8,000 60 2 2 1,500 Subtotal of Iowa 1,100 22 3 25 0 0 37,480 8,000 60 2 2 1,500 Kansas: 1 Casino White Cloud 350 6 3 9 500 0 21,000 0 0 1 0 500 2 Golden Eagle Casino 786 13 6 19 368 0 45,000 15,000 0 2 1 700 3 Prairie Band Casino & Resort 1,154 26 4 30 0 0 34,878 12,000 297 3 1 1,000 4 Sac & Fox Casino 500 7 0 7 0 0 53,000 0 0 4 0 400 Subtotal of Kansas 2,790 52 13 65 868 0 153,878 27,000 297 10 2 2,600 Missouri: 1 Ameristar Casino Hotel - Kansas City 3,016 90 15 105 0 0 140,000 14,520 184 11 3 2,660 2 Argosy Riverside Casino Hotel & Spa 1,924 39 8 47 0 0 62,000 18,000 258 5 3 2,700 3 Harrah's North Kansas City Casino & Hotel 1,793 60 12 72 0 0 60,133 10,000 392 6 1 3,122 4 Isle of Capri Casino - Boonville 905 27 6 33 0 0 28,000 12,000 140 3 1 1,102 5 Isle of Capri Casino - Kansas City 1,525 26 6 32 0 0 40,000 0 0 5 1 1,618 6 Terrible's St. Jo Frontier Casino 585 11 0 11 0 0 32,000 7,000 0 1 2 663 Subtotal of Missouri 9,748 253 47 300 0 0 362,133 61,520 974 31 11 11,865 Oklahoma: 1 Buffalo Run Casino 1,300 20 9 29 0 0 70,000 10,000 0 3 1 1,300 2 Eastern Shawnee Travel Plaza 186 0 0 0 0 0 3,000 0 0 0 0 150 3 High Winds Casino 500 8 0 8 0 0 35,000 0 0 2 0 450 4 Miami Tribe Entertainment 107 0 0 0 0 0 0 0 0 0 0 75 5 Peoria Gaming Center 200 0 0 0 0 0 4,200 0 0 1 0 250 6 Quapaw Casino 483 8 1 9 0 0 27,000 0 0 1 1 700 7 The Stables Casino 500 4 0 4 0 1 25,000 0 0 2 0 260 Subtotal of Oklahoma 3,276 40 10 50 0 1 164,200 10,000 0 9 2 3,185 18 Totals for Existing 18 Casinos 16,914 367 73 440 868 1 717,691 106,520 1,331 52 17 19,150

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-12 Kansas Casino Market Study & Gaming Revenue Projections

Analyses of the Gaming Revenue Scenarios

WGR developed six scenarios for the northeast trade area. To project a range of potential gaming revenue outcomes, WGR developed three cases (low, mid, and high) for each scenario. The focus of the discussions that follow is on WGR’s mid case results. The mid case was selected because it represents the most likely outcome.

Scenario 1

Scenario 1 includes the casinos currently competing for business within the northeast trade area, together with the addition of the proposed generic casino to be located in Wyandotte County.

The Wyandotte Casino has been projected to start operations in 2010 with a gaming capacity that includes 3,000 slot machines and 100 table games. Other assumed amenities include 100,000 square feet of convention/meeting space, 500 hotel rooms, six restaurants, and five entertainment venues (three small and two large).

Revenue Projections The gaming revenue projections shown in Exhibit 2-13 include WGR’s low, mid, and high case forecasts for 2010, and 2012. The mid case projections show casino gaming revenues of $954 million for 2010, increasing to $966 million by 2012. The percentage increases in gaming revenues over 2007 is 3.36% for 2010 and 4.7% for 2012. The mid case gaming revenue projections for Wyandotte County are $198 million for 2010 increasing to $201 million for 2012.

Exhibit 2-13 Revenues for Scenario 1 Includes all Existing Casinos + Wyandotte County Proposed for 2010

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Wyandotte County Proposed $0 $156,720,000 $159,175,000 $198,369,000 $201,491,000 $262,328,000 $266,433,000 Casinos w/in 50 miles $759,348,000 $650,898,000 $659,018,000 $615,982,000 $623,502,000 $562,857,000 $569,496,000 All Other Casinos $163,641,400 $146,440,700 $147,815,700 $139,713,600 $141,015,600 $128,879,600 $130,082,700 Total Scenario 1 $922,989,400 $954,058,700 $966,008,700 $954,064,600 $966,008,600 $954,064,600 $966,011,700

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-13 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Revenue Impacts Exhibit 2-14 shows that the major gaming revenue impact of adding Wyandotte County would be a $159 million reduction in the category captioned casinos located within 50 miles. WGR anticipates that this impact could increase to more than $161 million by 2012.

Exhibit 2-14 Revenue Impacts for Scenario 1 Includes all Existing Casinos + the Casino in Wyandotte County Proposed for 2010

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Wyandotte County Proposed $0 $156,720,000 $159,175,000 $198,369,000 $201,491,000 $262,328,000 $266,433,000 Casinos w/in 50 miles $0 -$123,659,000 -$125,685,000 -$158,575,000 -$161,201,000 -$211,700,000 -$215,207,000 All Other Casinos $0 -$19,478,500 -$19,676,800 -$26,205,600 -$26,476,900 -$37,039,600 -$37,409,800 Total Scenario 1 $0 $13,582,500 $13,813,200 $13,588,400 $13,813,100 $13,588,400 $13,816,200

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-14 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds Scenario 1 shows that the northeast trade area generated an estimated $923 million in gaming revenues in 2007 (refer to the first section of Exhibit 2-15 captioned Scenario 1 Revenues Coming From). Of this amount, more than $414 million was generated in Kansas. Of the $414 million, an estimated $88.5 million stayed in Kansas (a loss of $326 million). Refer to the third section of Exhibit 2-15 captioned Scenario 1 Mid Case - Revenues Going To.

Conversely, $504 million of the $923 million was generated in Missouri in 2007, while $779 million went to Missouri (a $275 million gain).

WGR’s projections of the anticipated shifts in casino revenue flows indicate that of the $438 million projected to be generated in Kansas in 2010, $273 million would stay in Kansas. The net loss would decline from the 2007 level of $326 million to $165 million by 2010.

Exhibit 2-15 Flows of Gaming Revenue Funds for Scenario 1 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 1 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $414,186,842 44.9% $417,457,538 $420,805,847 $437,796,175 45.9% $441,390,943 $445,057,329 46.1% MO $503,538,602 54.6% $506,015,208 $508,514,591 $511,064,763 53.6% $513,409,080 $515,786,564 53.4% NE $5,264,895 0.6% $5,243,332 $5,222,491 $5,200,061 0.5% $5,183,145 $5,165,162 0.5% Total $922,990,339 100.0% $928,716,078 $934,542,929 $954,060,999 100.0% $959,983,168 $966,009,055 100.0% Scenario 1 Low Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,442,000 $3,452,000 $3,033,000 0.3% $3,042,000 $3,050,000 0.3% KS $88,459,000 9.6% $88,869,000 $89,294,000 $235,128,000 24.6% $236,747,000 $238,403,000 24.7% MO $778,840,000 84.4% $783,919,000 $789,082,000 $669,200,000 70.1% $673,311,000 $677,488,000 70.1% OK $52,259,400 5.7% $52,487,900 $52,714,600 $46,697,700 4.9% $46,883,200 $47,067,700 4.9% Total $922,989,400 100.0% $928,717,900 $934,542,600 $954,058,700 100.0% $959,983,200 $966,008,700 100.0% Scenario 1 Mid Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,442,000 $3,452,000 $2,888,000 0.3% $2,895,000 $2,903,000 0.3% KS $88,459,000 9.6% $88,869,000 $89,294,000 $272,905,000 28.6% $274,838,000 $276,813,000 28.7% MO $778,840,000 84.4% $783,919,000 $789,082,000 $633,767,000 66.4% $637,578,000 $641,449,000 66.4% OK $52,259,400 5.7% $52,487,900 $52,714,600 $44,504,600 4.7% $44,671,900 $44,843,600 4.6% Total $922,989,400 100.0% $928,717,900 $934,542,600 $954,064,600 100.0% $959,982,900 $966,008,600 100.0% Scenario 1 High Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,442,000 $3,452,000 $2,651,000 0.3% $2,658,000 $2,665,000 0.3% KS $88,459,000 9.6% $88,869,000 $89,294,000 $330,654,000 34.7% $333,050,000 $335,494,000 34.7% MO $778,840,000 84.4% $783,919,000 $789,082,000 $579,773,000 60.8% $583,143,000 $586,565,000 60.7% OK $52,259,400 5.7% $52,487,900 $52,714,600 $40,986,600 4.3% $41,133,300 $41,287,700 4.3% Total $922,989,400 100.0% $928,717,900 $934,542,600 $954,064,600 100.0% $959,984,300 $966,011,700 100.0%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-15 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 2

Scenario 2 incorporates scenario 1 and the following casino expansions:

Kansas 1. Sac & Fox Casino in Powhattan, KS (March 2008)

Oklahoma 1. Creek Nation Casino in Tulsa, OK (September 2008) 2. Cherokee Casino Resort in Catoosa, OK (January 2009) 3. Cherokee Casino West Siloam Springs in Watts, OK (July 2009) 4. Kickapoo Casino in McLoud, OK (January 2009) 5. Osage Million Dollar Elm in Ponca City, OK (January 2009)

Revenue Forecasts Exhibit 2-16 shows total gaming revenue projections of $954 million for scenario 2 for the 2010 mid case. Included were $197 flowing to Wyandotte County, $613 million going to other casinos located within a 50-miles, and $144 million going to all other casinos located in the northeast trade area. Total gaming revenue projections for the mid-case are close to the forecasts developed for scenario 1. However, with the expansions listed above, gaming revenues for Wyandotte County are expected to decrease from $198.4 million to $197.1 (a $1.3 million decline) in 2010, and from $201.5 million to $200.2 million in 2012 (a $1.3 million decrease).

Exhibit 2-16 Revenues for Scenario 2 Includes Scenario 1 + the Expansions Listed Above

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Wyandotte County Proposed $0 $155,714,000 $158,159,000 $197,138,000 $200,247,000 $260,796,000 $264,885,000 Casinos w/in 50 miles $759,348,000 $647,663,000 $655,753,000 $613,087,000 $620,580,000 $560,453,000 $567,069,000 All Other Casinos $163,641,400 $150,686,600 $152,095,700 $143,836,700 $145,180,600 $132,812,900 $134,053,100 Total Scenario 2 $922,989,400 $954,063,600 $966,007,700 $954,061,700 $966,007,600 $954,061,900 $966,007,100

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-16 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Impacts Exhibit 2-17 illustrates that the gaming revenue impacts triggered by the casino expansions proposed in scenario 2 could result in the following revenue shifts when scenario 2 is compared with scenario 1. Shown are a loss of $1.2 million in 2010 for Wyandotte County, and a loss of $2.9 million for casinos located within a 50-miles. The all other casinos category could expect an approximate gain of $4.1 million.

Exhibit 2-17 Includes the Revenue Impacts for Scenario 2 Scenario 2 Includes Scenario 1 + the Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Wyandotte County Proposed $0 -$1,006,000 -$1,016,000 -$1,231,000 -$1,244,000 -$1,532,000 -$1,548,000 Casinos w/in 50 miles $0 -$3,235,000 -$3,265,000 -$2,895,000 -$2,922,000 -$2,404,000 -$2,427,000 All Other Casinos $0 $4,245,900 $4,280,000 $4,123,100 $4,165,000 $3,933,300 $3,970,400 Total Scenario 2 $0 $4,900 -$1,000 -$2,900 -$1,000 -$2,700 -$4,600

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-17 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Flows The addition of Wyandotte County (scenario 1), together with the expansions at the casinos listed on page 2-16 (scenario 2), trigger the shifts in casino revenue flows that are shown in Exhibit 2-18. Out of the $438 million generated in Kansas in 2010 (refer to the first section of Exhibit 2-18 captioned Scenario 2 Revenues Coming From), an estimated $273 million would stay in Kansas in the 2010 mid case (refer to the third section of Exhibit 2-18 captioned Scenario 2 Mid Case - Revenues Going To). With the addition of the casino in Wyandotte County and the casino expansions included in scenario 2, the net loss would decline from $326 million (2007) to $165 million (2010).

Given the scenario 2 assumptions, Missouri would continue to be the biggest recipient of the gaming revenues generated in the northeast trade area. The net difference between what could be generated in Missouri and what could flow back to Missouri (scenario 2 mid case) has been estimated at $120 million.

Exhibit 2-18 Flows of Gaming Revenue Funds for Scenario 2 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 2 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $414,186,842 44.9% $417,457,538 $420,805,847 $437,796,175 45.9% $441,390,943 $445,057,329 46.1% MO $503,538,602 54.6% $506,015,208 $508,514,591 $511,064,763 53.6% $513,409,080 $515,786,564 53.4% NE $5,264,895 0.6% $5,243,332 $5,222,491 $5,200,061 0.5% $5,183,145 $5,165,162 0.5% Total $922,990,339 100.0% $928,716,078 $934,542,929 $954,060,999 100.0% $959,983,168 $966,009,055 100.0% Scenario 2 Low Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,395,000 $3,379,000 $2,974,000 0.3% $2,982,000 $2,991,000 0.3% KS $88,459,000 9.6% $91,076,000 $90,919,000 $235,742,000 24.7% $237,364,000 $239,021,000 24.7% MO $778,840,000 84.4% $781,122,000 $784,324,000 $665,741,000 69.8% $669,834,000 $673,996,000 69.8% OK $52,259,400 5.7% $53,121,900 $55,920,800 $49,606,600 5.2% $49,805,100 $49,999,700 5.2% Total $922,989,400 100.0% $928,714,900 $934,542,800 $954,063,600 100.0% $959,985,100 $966,007,700 100.0% Scenario 2 Mid Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,395,000 $3,379,000 $2,833,000 0.3% $2,841,000 $2,849,000 0.3% KS $88,459,000 9.6% $91,076,000 $90,919,000 $273,277,000 28.6% $275,212,000 $277,186,000 28.7% MO $778,840,000 84.4% $781,122,000 $784,324,000 $630,663,000 66.1% $634,460,000 $638,316,000 66.1% OK $52,259,400 5.7% $53,121,900 $55,920,800 $47,288,700 5.0% $47,472,200 $47,656,600 4.9% Total $922,989,400 100.0% $928,714,900 $934,542,800 $954,061,700 100.0% $959,985,200 $966,007,600 100.0% Scenario 2 High Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,395,000 $3,379,000 $2,604,000 0.3% $2,611,000 $2,618,000 0.3% KS $88,459,000 9.6% $91,076,000 $90,919,000 $330,696,000 34.7% $333,089,000 $335,533,000 34.7% MO $778,840,000 84.4% $781,122,000 $784,324,000 $577,184,000 60.5% $580,540,000 $583,951,000 60.4% OK $52,259,400 5.7% $53,121,900 $55,920,800 $43,577,900 4.6% $43,743,600 $43,905,100 4.5% Total $922,989,400 100.0% $928,714,900 $934,542,800 $954,061,900 100.0% $959,983,600 $966,007,100 100.0%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-18 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 3

Scenario 3 includes scenario 2, plus the other proposed casinos listed below:

Kansas 1. Wyandotte 7th Street Casino in Kansas City, KS (January 2008) 2. The Woodlands in Kansas City, KS (January 2009) 3. Camptown Greyhound Park planned for in Frontenac, KS (January 2009) 4. Cherokee County planned in Baxter Springs, KS (January 2010) 5. Sumner County planned in Wellington, KS (January 2010)

Missouri 1. Barden Development, Inc. planned in Branson, MO (targeted for 2010) 2. Wild Rose Entertainment casino planned for Sugar Creek, MO (January 2010)

Oklahoma 1. Downstream Casino Resort in Ottawa, OK (July 2008) 2. First Council Casino in for Newkirk, OK (March 2008) 3. Seneca-Cayuga Tribes of Oklahoma planned in Grove, OK (July 2008) 4. Ioway Casino Resort in Lincoln, OK (January 2009) 5. Muscogee Creek Nation planned in Eufaula, OK (planned for 2010) 6. Pawnee Nation Planned in Chilocco, OK (targeted or 2010) 7. Ponca Tribe Oklahoma planned in Ponca City, OK (proposed for 2010) 8. Poteau Travel and Smoke Shop in Poteau, OK (planned for 2010) 9. Shawnee Tribe Oklahoma planned in Oklahoma City, OK (targeted for 2010) 10. Wichita & Affiliated Tribes planned in Hinton, OK (proposed for 2010) 11. Wilburton Travel and Smoke Shop in Wilburton, OK (planned for 2010)

May 2008 Wells Gaming Research Page 2-19 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Forecasts Exhibit 2-19 illustrates that the scenario 3 forecasts for total gaming revenues were $978 million for the 2010 mid case. Allocations include $173 million for Wyandotte County, $27.5 million for the Woodlands Race Track, $76.5 million for proposed casinos within a 50- mile radius, $35.5 million for other proposed casinos, $539 for casinos located within 50 miles, and $127 million for all other casinos located within the northeast trade area.

Exhibit 2-19 Revenues for Scenario 3 Scenario 3 Includes Scenario 2 + the Other Proposed Casinos

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Wyandotte County Proposed $0 $134,597,000 $136,729,000 $173,005,000 $175,752,000 $233,277,000 $236,958,000 *The Woodlands $0 $30,067,000 $30,496,000 $27,472,000 $27,865,000 $23,834,000 $24,174,000 *Proposed Casinos w/in 50 miles $0 $80,019,000 $80,915,000 $76,456,000 $77,293,000 $70,814,000 $71,561,000 *Other Proposed Casinos $0 $36,530,700 $36,780,900 $35,441,200 $35,677,300 $33,648,300 $33,863,400 Casinos w/in 50 miles $759,348,000 $564,779,000 $571,879,000 $538,786,000 $545,431,000 $498,096,000 $504,051,000 All Other Casinos $163,641,400 $131,705,800 $132,964,100 $126,539,500 $127,740,700 $118,029,300 $119,150,300 Total Scenario 3 $922,989,400 $977,698,500 $989,764,000 $977,699,700 $989,759,000 $977,698,600 $989,757,700

Data Sources: Wells Gaming Research, April 2008.

Revenue Impacts Exhibit 2-20 indicates that a large share of the gaming revenue impacts in the 2010 mid case have been forecasted to go to proposed casinos located within 50 miles ($76.5 million), as well as the other proposed casinos ($35.4 million). The biggest losses are forecasted for casinos within 50 miles ($74 million), and the Wyandotte County ($24 million).

Exhibit 2-20 Revenue Impacts of Scenario 3 Scenario 3 Includes Scenario 2 + Other Proposed Casinos

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Wyandotte County Proposed $0 -$21,117,000 -$21,430,000 -$24,133,000 -$24,495,000 -$27,519,000 -$27,927,000 *The Woodlands $0 $30,067,000 $30,496,000 $27,472,000 $27,865,000 $23,834,000 $24,174,000 *Proposed Casinos w/in 50 miles $0 $80,019,000 $80,915,000 $76,456,000 $77,293,000 $70,814,000 $71,561,000 *Other Proposed Casinos $0 $36,530,700 $36,780,900 $35,441,200 $35,677,300 $33,648,300 $33,863,400 Casinos w/in 50 miles $0 -$82,884,000 -$83,874,000 -$74,301,000 -$75,149,000 -$62,357,000 -$63,018,000 All Other Casinos $0 -$18,980,800 -$19,131,600 -$17,297,200 -$17,439,900 -$14,783,600 -$14,902,800 Total Scenario 3 $0 $23,634,900 $23,756,300 $23,638,000 $23,751,400 $23,636,700 $23,750,600

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-20 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Flows Exhibit 2-21 illustrates the impact of the proposed casinos in Kansas, Missouri, and Oklahoma listed under scenario 3. Kansas would generate $450 million in gaming revenues for 2010 in scenario 3 (refer to the first section of Exhibit 2-21 captioned Scenario 3 Revenues Coming From). Of this amount, the mid case shows that $308 million would stay in Kansas. The net loss would be $142 million (refer to the third section of Exhibit 2-21 captioned Scenario 3 Mid Case - Revenues Going To). This compares with the net loss sustained in 2007 of $326 million without the casino additions or expansions.

Given the scenario 3 assumptions, Missouri could generate $522 million in the 2010. Of this amount, $614 million should stay in Missouri for an estimated gain of $92 million in the 2010 mid case.

Exhibit 2-21 Flow of Gaming Revenue Funds for Scenario 3 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 3 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $414,186,842 44.9% $423,652,322 $443,800,724 $450,309,623 46.1% $453,908,437 $457,579,439 46.2% MO $503,538,602 54.6% $507,231,917 $515,228,137 $522,188,007 53.4% $524,584,410 $527,014,529 53.2% NE $5,264,895 0.6% $5,243,332 $5,222,491 $5,200,061 0.5% $5,183,145 $5,165,162 0.5% Total $922,990,339 100.0% $936,127,571 $964,251,352 $977,697,691 100.0% $983,675,992 $989,759,130 100.0% Scenario 3 Low Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,184,000 $2,592,000 0.3% $2,599,000 $2,606,000 0.3% KS $88,459,000 9.6% $115,665,000 $169,575,000 $276,469,000 28.3% $278,278,000 $280,127,000 28.3% MO $778,840,000 84.4% $755,543,000 $726,933,000 $642,410,000 65.7% $646,357,000 $650,365,000 65.7% OK $52,259,400 5.7% $61,628,400 $64,557,700 $56,227,500 5.8% $56,445,200 $56,666,000 5.7% Total $922,989,400 100.0% $936,124,400 $964,249,700 $977,698,500 100.0% $983,679,200 $989,764,000 100.0% Scenario 3 Mid Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,184,000 $2,487,000 0.3% $2,493,000 $2,500,000 0.3% KS $88,459,000 9.6% $115,665,000 $169,575,000 $307,684,000 31.5% $309,754,000 $311,871,000 31.5% MO $778,840,000 84.4% $755,543,000 $726,933,000 $613,558,000 62.8% $617,256,000 $621,013,000 62.7% OK $52,259,400 5.7% $61,628,400 $64,557,700 $53,970,700 5.5% $54,171,400 $54,375,000 5.5% Total $922,989,400 100.0% $936,124,400 $964,249,700 $977,699,700 100.0% $983,674,400 $989,759,000 100.0% Scenario 3 High Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,184,000 $2,312,000 0.2% $2,318,000 $2,324,000 0.2% KS $88,459,000 9.6% $115,665,000 $169,575,000 $356,873,000 36.5% $359,345,000 $361,864,000 36.6% MO $778,840,000 84.4% $755,543,000 $726,933,000 $568,240,000 58.1% $571,560,000 $574,933,000 58.1% OK $52,259,400 5.7% $61,628,400 $64,557,700 $50,273,600 5.1% $50,455,200 $50,636,700 5.1% Total $922,989,400 100.0% $936,124,400 $964,249,700 $977,698,600 100.0% $983,678,200 $989,757,700 100.0%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-21 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 3A

The data shown in Exhibit 2-22 for scenario 3A is the same as scenario 3, but without the Wild Rose Entertainment Casino that is planned for Sugar Creek, Missouri.

Revenue Forecasts Overall, the mid case revenue projections for scenario 3A for 2010 are $5 million lower than in scenario 3 ($978 versus $973). The biggest difference would be for proposed casinos located within a 50-mile radius. The scenario 3 total was $76.5 million. In scenario 3A, revenues for this group slip to $20 million reflecting, in part, the loss of the Wild Rose.

Exhibit 2-22 Revenues for Scenario 3A Scenario 3A Includes Scenario 3 w/o the Wild Rose Sugar Creek Casino

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Wyandotte County Proposed $0 $141,099,000 $143,341,000 $180,935,000 $183,813,000 $243,089,000 $246,923,000 *The Woodlands $0 $31,529,000 $31,980,000 $28,742,000 $29,155,000 $24,850,000 $25,205,000 *Proposed Casinos w/in 50 miles $0 $21,049,000 $21,265,000 $19,818,000 $20,014,000 $17,934,000 $18,102,000 *Other Proposed Casinos $0 $37,669,300 $37,928,500 $36,479,700 $36,725,900 $34,534,800 $34,758,900 Existing Casinos w/in 50 miles $759,348,000 $605,441,000 $612,987,000 $576,408,000 $583,448,000 $531,134,000 $537,416,000 All Other Existing Casinos $163,641,400 $136,522,300 $137,816,600 $130,925,500 $132,165,600 $121,762,300 $122,918,500 Total Scenario 3A $922,989,400 $973,309,600 $985,318,100 $973,308,200 $985,321,500 $973,304,100 $985,323,400

Data Sources: Wells Gaming Research, April 2008. Revenue Impacts The gaming revenue impacts linked to scenario 3A show an overall net gain of $19 million (refer to Exhibit 2-23). The major gains are in the category captioned other proposed casinos ($36.5 million) and the Woodlands ($29 million). The casinos located within 50 miles ($37 million) and Wyandotte County ($16 million) are the most likely to sustain the major losses.

Exhibit 2-23 Revenue Impacts for Scenario 3A Scenario 3A Includes Scenario 3 w/o the Wild Rose Sugar Creek Casino

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Wyandotte County Proposed $0 -$14,615,000 -$14,818,000 -$16,203,000 -$16,434,000 -$17,707,000 -$17,962,000 *The Woodlands $0 $31,529,000 $31,980,000 $28,742,000 $29,155,000 $24,850,000 $25,205,000 *Proposed Casinos w/in 50 miles $0 $21,049,000 $21,265,000 $19,818,000 $20,014,000 $17,934,000 $18,102,000

*Other Proposed Casinos $0 $37,669,300 $37,928,500 $36,479,700 $36,725,900 $34,534,800 $34,758,900 Existing Casinos w/in 50 miles $0 -$42,222,000 -$42,766,000 -$36,679,000 -$37,132,000 -$29,319,000 -$29,653,000 All Other Existing Casinos $0 -$14,164,300 -$14,279,100 -$12,911,200 -$13,015,000 -$11,050,600 -$11,134,600 Total Scenario 3A $0 $19,246,000 $19,310,400 $19,246,500 $19,313,900 $19,242,200 $19,316,300

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-22 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Flows Exhibit 2-24 shows the gaming revenue flows for scenario 3A (excludes the Wild Rose). Kansas has been projected to generate more than $450 million in gaming revenues in 2010 (refer to the first section of Exhibit 2-24 captioned Scenario 3A Revenues Coming From). Approximately $320 would go to Kansas in the mid case, a net loss of $130 million (refer to the third section of Exhibit 2-24 captioned Scenario 3A Mid Case - Revenues Going To).

Missouri has been forecasted to generate $518 million in gaming revenues in 2010. In the 2010 mid case, $594 million has been projected to stay in Missouri (a net gain of $76 million). This compares with scenario 3 (includes the Wild Rose), wherein Missouri generated $522 million in gaming revenues and retained approximately $614 million (a net gain of $92 million).

Exhibit 2-24 Flows of Gaming Revenue Funds for Scenario 3A Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 3A Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $414,186,842 44.9% $423,652,322 $443,800,724 $450,309,623 46.3% $453,908,437 $457,579,439 46.4% MO $503,538,602 54.6% $507,231,917 $515,228,137 $517,799,515 53.2% $520,172,606 $522,579,323 53.0% NE $5,264,895 0.6% $5,243,332 $5,222,491 $5,200,061 0.5% $5,183,145 $5,165,162 0.5% Total $922,990,339 100.0% $936,127,571 $964,251,352 $973,309,199 100.0% $979,264,188 $985,323,924 100.0% Scenario 3A Low Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,184,000 $2,724,000 0.3% $2,731,000 $2,739,000 0.3% KS $88,459,000 9.6% $115,665,000 $169,575,000 $288,238,000 29.6% $290,128,000 $292,063,000 29.6% MO $778,840,000 84.4% $755,543,000 $726,933,000 $623,778,000 64.1% $627,608,000 $631,492,000 64.1% OK $52,259,400 5.7% $61,628,400 $64,557,700 $58,569,600 6.0% $58,794,100 $59,024,100 6.0% Total $922,989,400 100.0% $936,124,400 $964,249,700 $973,309,600 100.0% $979,261,100 $985,318,100 100.0% Scenario 3A Mid Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,184,000 $2,607,000 0.3% $2,614,000 $2,621,000 0.3% KS $88,459,000 9.6% $115,665,000 $169,575,000 $320,330,000 32.9% $322,491,000 $324,699,000 33.0% MO $778,840,000 84.4% $755,543,000 $726,933,000 $594,273,000 61.1% $597,846,000 $601,475,000 61.0% OK $52,259,400 5.7% $61,628,400 $64,557,700 $56,098,200 5.8% $56,308,700 $56,526,500 5.7% Total $922,989,400 100.0% $936,124,400 $964,249,700 $973,308,200 100.0% $979,259,700 $985,321,500 100.0% Scenario 3A High Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,184,000 $2,415,000 0.2% $2,421,000 $2,427,000 0.2% KS $88,459,000 9.6% $115,665,000 $169,575,000 $370,617,000 38.1% $373,183,000 $375,801,000 38.1% MO $778,840,000 84.4% $755,543,000 $726,933,000 $548,197,000 56.3% $551,389,000 $554,634,000 56.3% OK $52,259,400 5.7% $61,628,400 $64,557,700 $52,075,100 5.4% $52,270,700 $52,461,400 5.3% Total $922,989,400 100.0% $936,124,400 $964,249,700 $973,304,100 100.0% $979,263,700 $985,323,400 100.0%

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-23 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 4

Scenario 4 was developed to evaluate the impact of the Woodlands Race Track on the gaming revenue forecasts.

Scenario 4 includes the casinos currently in operation (same as in scenario 1), and the mid case for the Woodlands Race Track. The gaming capacity additions are limited to the Woodlands Racetrack and include approximately 800 slot machines and a race book. Other amenities proposed for the Woodlands Race Track include four restaurants.

Revenue Forecasts The total gaming revenues profiled in Exhibit 2-25 are within $3 million of scenario 1, $954 million for scenario 1 versus $951 million for scenario 4 with the Woodlands Race Track. The allocation of projected gaming revenues would be approximately $47 million for the category captioned the Woodlands, $741 million for casinos located within 50 miles, and $162 million for all other casinos.

Exhibit 2-25 Revenues for Scenario 4 Scenario 4 Includes the Current Casinos + the Woodlands Race Track

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*The Woodlands $0 $25,878,000 $26,179,000 $47,329,000 $47,934,000 $66,491,000 $67,384,000 Casinos w/in 50 Miles $759,348,000 $759,991,000 $769,988,000 $741,444,000 $751,167,000 $724,998,000 $734,461,000 All Other Casinos $163,641,400 $164,709,400 $166,271,700 $161,806,700 $163,341,900 $159,091,300 $160,596,300 Total Scenario 4 $922,989,400 $950,578,400 $962,438,700 $950,579,700 $962,442,900 $950,580,300 $962,441,300

Data Sources: Wells Gaming Research, April 2008. Revenue Impacts Exhibit 2-26 illustrates the changes in gaming revenue allocations that may be expected when the Woodlands Race Track is added to the current situation without any other casino additions or expansions.

Exhibit 2-26 Revenue Impacts for Scenario 4 Scenario 4 Includes the Current Casinos + the Woodlands Race Track

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*The Woodlands $0 $25,878,000 $26,179,000 $47,329,000 $47,934,000 $66,491,000 $67,384,000 Casinos w/in 50 Miles $0 -$14,566,000 -$14,715,000 -$33,113,000 -$33,536,000 -$49,559,000 -$50,242,000

All Other Casinos $0 -$1,209,800 -$1,220,800 -$4,112,500 -$4,150,600 -$6,827,900 -$6,896,200 Total Scenario 4 $0 $10,102,200 $10,243,200 $10,103,500 $10,247,400 $10,104,100 $10,245,800

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-24 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Flows Exhibit 2-27 shows the scenario 4 forecasts with the Woodlands Race Track. The anticipated shifts in casino revenue flows indicate that $434 million was projected to be generated in Kansas in the 2010 (refer to the first section of Exhibit 2-27 captioned Scenario 4 Revenues Coming From). An estimated $135 million would stay in Kansas (refer to the third section of Exhibit 2-27 captioned Scenario 4 Mid - Revenues Going To). The net loss to Kansas would be $299 million.

Given the scenario 4 assumptions, Missouri would generate $511 million in 2010. In the 2010 mid case forecasts, $761 million in gaming revenue has been forecasted to stay in Missouri, for a gain of $250 million.

Exhibit 2-27 Flows of Gaming Revenue Funds for Scenario 4 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 4 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 KS $414,186,842 44.9% $417,457,538 $430,761,089 $434,246,063 47.0% $437,798,317 $441,421,637 45.9% MO $503,538,602 54.6% $506,015,208 $508,591,673 $511,131,612 55.4% $513,476,830 $515,855,222 53.6% NE $5,264,895 0.6% $5,243,332 $5,222,491 $5,200,061 0.6% $5,183,145 $5,165,162 0.5% Total $922,990,339 100.0% $928,716,078 $944,575,253 $950,577,736 103.0% $956,458,292 $962,442,021 100.0%

Scenario 4 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 IA $3,431,000 0.4% $3,442,000 $3,415,000 $3,426,000 0.4% $3,436,000 $3,446,000 0.4% KS $88,459,000 9.6% $88,869,000 $114,299,000 $114,886,000 12.4% $115,486,000 $116,105,000 12.1% MO $778,840,000 84.4% $783,919,000 $774,438,000 $779,612,000 84.5% $784,662,000 $789,791,000 82.1% OK $52,259,400 5.7% $52,487,900 $52,420,600 $52,654,400 5.7% $52,875,000 $53,096,700 5.5% Total $922,989,400 100.0% $928,717,900 $944,572,600 $950,578,400 103.0% $956,459,000 $962,438,700 100.0%

Scenario 4 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 IA $3,431,000 0.4% $3,442,000 $3,352,000 $3,362,000 0.4% $3,372,000 $3,382,000 0.4% KS $88,459,000 9.6% $88,869,000 $133,912,000 $134,645,000 14.6% $135,388,000 $136,152,000 14.1% MO $778,840,000 84.4% $783,919,000 $755,827,000 $760,863,000 82.4% $765,775,000 $770,766,000 80.1% OK $52,259,400 5.7% $52,487,900 $51,488,200 $51,709,700 5.6% $51,923,200 $52,142,900 5.4% Total $922,989,400 100.0% $928,717,900 $944,579,200 $950,579,700 103.0% $956,458,200 $962,442,900 100.0%

Scenario 4 - High Revenues Going To State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 IA $3,431,000 0.4% $3,442,000 $3,293,000 $3,303,000 0.4% $3,312,000 $3,322,000 0.3% KS $88,459,000 9.6% $88,869,000 $151,355,000 $152,225,000 16.5% $153,104,000 $154,007,000 16.0% MO $778,840,000 84.4% $783,919,000 $739,320,000 $744,224,000 80.6% $749,005,000 $753,864,000 78.3% OK $52,259,400 5.7% $52,487,900 $50,603,600 $50,828,300 5.5% $51,037,800 $51,248,300 5.3% Total $922,989,400 100.0% $928,717,900 $944,571,600 $950,580,300 103.0% $956,458,800 $962,441,300 100.0%

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-25 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 5

Scenario 5 includes scenario 4 (the casinos currently in operation plus the Woodlands Race Track), as well as the following casino expansions:

Kansas 1. Sac & Fox Casino in Powhattan, KS (March 2008)

Oklahoma 1. Creek Nation Casino in Tulsa, OK (September 2008) 2. Cherokee Casino Resort in Catoosa, OK (January 2009) 3. Cherokee Casino West Siloam Springs in Watts, OK (July 2009) 4. Kickapoo Casino in McLoud, OK (January 2009) 5. Osage Million Dollar Elm in Ponca City, OK (January 2009)

Revenue Forecasts Exhibit 2-28 shows total gaming revenue estimates of $951 million for scenario 5 (2010 mid case). Of the total, approximately $47 million went to the Woodlands, $737 million to casinos located within 50 miles, and $166 to all other casinos located in the northeast trade area.

Exhibit 2-28 Revenues for Scenario 5 Includes Scenario 4 (Current Casinos + the Woodlands Race Track) & the Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*The Woodlands $0 $25,702,000 $26,000,000 $47,002,000 $47,603,000 $66,032,000 $66,919,000 Casinos w/in 50 Miles $759,348,000 $755,617,000 $765,569,000 $737,270,000 $746,950,000 $721,005,000 $730,424,000 All Other Casinos $163,641,400 $169,257,500 $170,872,700 $166,303,100 $167,889,300 $163,542,700 $165,096,800 Total Scenario 5 $922,989,400 $950,578,400 $962,438,700 $950,579,700 $962,442,900 $950,579,700 $962,439,800

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-26 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Impacts The total revenue impacts show a negligible decrease of $4,600 in overall gaming revenues for the 2010 mid case of the scenario 5 (refer to Exhibit 2-29). The category referred to as all other casinos is the only one showing a gain ($4.5 million). Negative impacts have been projected for the Woodlands ($327 thousand) and for casinos located within 50 miles ($4.2 million).

Exhibit 2-29 Revenue Impacts for Scenario 5 Includes Scenario 4 (Current Casinos + the Woodlands Race Track) & the Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*The Woodlands $0 -$176,000 -$179,000 -$327,000 -$331,000 -$459,000 -$465,000

Casinos w/in 50 Miles $0 -$4,374,000 -$4,419,000 -$4,174,000 -$4,217,000 -$3,993,000 -$4,037,000

All Other Casinos $0 $4,548,100 $4,601,000 $4,496,400 $4,547,400 $4,451,400 $4,500,500 Total Scenario 5 $0 -$1,900 $3,000 -$4,600 -$600 -$600 -$1,500

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-27 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Flows Exhibit 2-30 shows 2010 gaming revenues of $951 million (refer to the first section of Exhibit 2-30 captioned Scenario 5 Revenues Coming From). These revenues have been estimated to have been generated in Kansas ($434 million), Missouri ($511 million), and Nebraska ($5 million).

The 2010 mid case allocations of the $951 million show Iowa ($3.3 million), Kansas ($136 million), Missouri ($756 million), and Oklahoma ($55 million). Refer to the third section of Exhibit 2-30 captioned Scenario 5 Mid - Revenues Going To. The difference for Kansas between the $434 million projected to be generated in 2010 and the $136 million expected to be retained in Kansas (2010 mid case) is an outflow of $298 million. Missouri, on the other hand, has been estimated to produce $511 million in 2010 and enjoy inflows of $756 million for a positive difference of $245 million in the 2010 mid case. Inflows to Oklahoma from the Tribal casino additions have been estimated at $55 million in the 2010 mid case.

Exhibit 2-30 Flow of Gaming Revenue Funds for Scenario 5 Illustrates Where the Gaming Revenues Originated & Were They Went

Scenario 5 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 KS $414,186,842 44.9% $417,457,538 $430,761,089 $434,246,063 47.0% $437,798,317 $441,421,637 45.9% MO $503,538,602 54.6% $506,015,208 $508,591,673 $511,131,612 55.4% $513,476,830 $515,855,222 53.6% NE $5,264,895 0.6% $5,243,332 $5,222,491 $5,200,061 0.6% $5,183,145 $5,165,162 0.5% Total $922,990,339 100.0% $928,716,078 $944,575,253 $950,577,736 103.0% $956,458,292 $962,442,021 100.0%

Scenario 5 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 IA $3,431,000 0.4% $3,395,000 $3,343,000 $3,354,000 0.4% $3,363,000 $3,374,000 0.4% KS $88,459,000 9.6% $91,076,000 $115,775,000 $116,369,000 12.6% $116,976,000 $117,602,000 12.2% MO $778,840,000 84.4% $781,122,000 $769,827,000 $774,973,000 84.0% $779,999,000 $785,105,000 81.6% OK $52,259,400 5.7% $53,121,900 $55,632,000 $55,880,500 6.1% $56,116,200 $56,360,700 5.9% Total $922,989,400 100.0% $928,714,900 $944,577,000 $950,576,500 103.0% $956,454,200 $962,441,700 100.0%

Scenario 5 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 IA $3,431,000 0.4% $3,395,000 $3,282,000 $3,292,000 0.4% $3,302,000 $3,312,000 0.3% KS $88,459,000 9.6% $91,076,000 $135,230,000 $135,970,000 14.7% $136,718,000 $137,489,000 14.3% MO $778,840,000 84.4% $781,122,000 $751,421,000 $756,430,000 82.0% $761,321,000 $766,288,000 79.6% OK $52,259,400 5.7% $53,121,900 $54,639,500 $54,883,100 5.9% $55,117,600 $55,353,300 5.8% Total $922,989,400 100.0% $928,714,900 $944,572,500 $950,575,100 103.0% $956,458,600 $962,442,300 100.0%

Scenario 5 High - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2007 2011 2012 % 2012 IA $3,431,000 0.4% $3,395,000 $3,225,000 $3,235,000 0.4% $3,244,000 $3,254,000 0.3% KS $88,459,000 9.6% $91,076,000 $152,537,000 $153,411,000 16.6% $154,296,000 $155,204,000 16.1% MO $778,840,000 84.4% $781,122,000 $735,096,000 $739,978,000 80.2% $744,738,000 $749,573,000 77.9% OK $52,259,400 5.7% $53,121,900 $53,715,000 $53,955,700 5.8% $54,180,200 $54,408,800 5.7% Total $922,989,400 100.0% $928,714,900 $944,573,000 $950,579,700 103.0% $956,458,200 $962,439,800 100.0%

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-28 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 6

Results for scenario 6 are equal to scenario 5 plus the following other proposed casinos:

Kansas 1. Camptown Greyhound Park in Frontenac, KS (January 2009) 2. Cherokee County planned in Baxter Springs, KS (January 2010) 3. Wyandotte 7th Street Casino in Kansas City, KS (January 2008) 4. Wyandotte County planned in Kansas City, KS (January 2010) 5. Sumner County planned in Wellington, KS (January 2010)

Missouri 1. Barden Development, Inc. planned in Branson, MO 2. Wild Rose Entertainment planned in Sugar Creek, MO (January 2010)

Oklahoma 1. Downstream Casino Resort in Ottawa, OK (July 2008) 2. First Council Casino in Newkirk, OK (March 2008) 3. Iowa Casino Resort in Lincoln, OK 4. Muscogee Creek Nation planned in Eufaula, OK 5. Pawnee Nation planned in Chilocco, OK 6. Ponca Tribe Oklahoma planned in Ponca City, OK 7. Poteau Travel and Smoke Shop in Poteau, OK 8. Seneca-Cayuga Tribes of Oklahoma planned in Grove, OK (July 2008) 9. Shawnee Tribe Oklahoma planned in Oklahoma City, OK 10. Wichita & Affiliated Tribes planned in Hinton, OK 11. Wilburton Travel and Smoke Shop in Wilburton, OK

May 2008 Wells Gaming Research Page 2-29 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Projections The following 2010 mid case gaming revenue estimates shown in Exhibit 2-31 for scenario 6 include a total of $978 million (incorporates scenario 5 and the proposed new casinos listed on page 2-29). Wells Gaming Research’s estimates show $27 million going to the Woodlands, $173 million to Wyandotte County, $76.5 million to proposed casinos located within 50 miles, $36 million to other proposed casinos, $539 million to casinos located within 50 miles, and $127 million to all other casinos located within the northeast trade area.

Exhibit 2-31 Revenues for Scenario 6 Includes Scenario 5 + Other Proposed Casinos

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*The Woodlands $0 $14,102,000 $14,302,000 $27,472,000 $27,865,000 $40,214,000 $40,793,000 *Wyandotte County Planned $0 $177,067,000 $179,870,000 $173,005,000 $175,752,000 $169,223,000 $171,916,000 *Proposed Casinos w/in 50 Miles $0 $77,373,000 $78,223,000 $76,456,000 $77,293,000 $75,572,000 $76,396,000 *Other Proposed Casinos $0 $35,729,300 $35,965,500 $35,441,200 $35,677,300 $35,163,100 $35,396,200 Existing Casinos w/i 50 Miles $759,348,000 $545,506,000 $552,259,000 $538,786,000 $545,431,000 $532,332,000 $538,872,000 All Other Existing Casinos $163,641,400 $127,922,300 $129,138,300 $126,539,500 $127,740,700 $125,196,000 $126,386,000 Total Scenario 6 $922,989,400 $977,699,600 $989,757,800 $977,699,700 $989,759,000 $977,700,100 $989,759,200

Data Sources: Wells Gaming Research, April 2008.

Revenue Impacts The major revenue impacts illustrated in Exhibit 2-32 for the scenario 6 mid case for 2010 reflect a net impact of $27 million. The projected impacts include a negative $19.5 million for the Woodlands. Other projected impacts include positive impacts for Wyandotte County ($173 million), proposed casinos located within 50 miles ($76.5 million), and other proposed casinos ($35 million). Losses have been forecasted for casinos located within 50 miles ($198.5 million) and for all other casinos ($40 million).

Exhibit 2-32 Revenue Impacts for Scenario 6 Includes Scenario 5 + Other Proposed Casinos

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*The Woodlands $0 -11,600,000 -11,698,000 -$19,530,000 -$19,738,000 -$25,818,000 -$26,126,000 *Wyandotte County Planned $0 177,067,000 179,870,000 $173,005,000 $175,752,000 $169,223,000 $171,916,000 *Proposed Casinos w/in 50 Miles $0 77,373,000 78,223,000 $76,456,000 $77,293,000 $75,572,000 $76,396,000 *Other Proposed Casinos $0 35,729,300 35,965,500 $35,441,200 $35,677,300 $35,163,100 $35,396,200 Existing Casinos w/i 50 Miles $0 -210,111,000 -213,310,000 -$198,484,000 -$201,519,000 -$188,673,000 -$191,552,000 All Other Existing Casinos $0 -41,335,200 -41,734,400 -$39,763,600 -$40,148,600 -$38,346,700 -$38,710,800 Total Scenario 6 $0 $27,123,100 $27,316,100 $27,124,600 $27,316,700 $27,120,400 $27,319,400

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-30 Kansas Casino Market Study & Gaming Revenue Projections

Flow of Revenues Exhibit 2-33 shows that the $978 million in total gaming revenues would come from Kansas ($450 million), Missouri ($522 million), and Nebraska ($5.2 million) in scenario 6 the 2010 (refer to the first section of Exhibit 2-33 captioned Scenario 6 Revenues Coming From). The $978 million in gaming revenues forecasted to be generated in the 2010 scenario 6 mid case has been allocated to Iowa ($2.5 million), Kansas ($308 million), Missouri ($614 million), and Oklahoma ($54 million) in the 2010 mid case. The net result for Kansas would be a loss of $142 million. The net loss for Kansas would be approximately $143 million (refer to the third section of Exhibit 2-33 captioned Scenario 6 Mid - Revenues Going To).

Exhibit 2-33 Flows of Gaming Revenue Funds for Scenario 6 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 6 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $414,186,842 44.9% $423,652,322 $443,800,724 $450,309,623 46.1% $453,908,437 $457,579,439 46.2% MO $503,538,602 54.6% $507,231,917 $515,228,137 $522,188,007 53.4% $524,584,410 $527,014,529 53.2% NE $5,264,895 0.6% $5,243,332 $5,222,491 $5,200,061 0.5% $5,183,145 $5,165,162 0.5% Total $922,990,339 100.0% $936,127,571 $964,251,352 $977,697,691 100.0% $983,675,992 $989,759,130 100.0% Scenario 6 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,241,000 $2,516,000 0.3% $2,522,000 $2,529,000 0.3% KS $88,459,000 9.6% $115,665,000 $151,483,000 $299,591,000 30.6% $301,599,000 $303,651,000 30.7% MO $778,840,000 84.4% $755,543,000 $743,857,000 $621,030,000 63.5% $624,787,000 $628,603,000 63.5% OK $52,259,400 5.7% $61,628,400 $65,672,900 $54,562,600 5.6% $54,764,200 $54,974,800 5.6% Total $922,989,400 100.0% $936,124,400 $964,253,900 $977,699,600 100.0% $983,672,200 $989,757,800 100.0% Scenario 6 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,184,000 $2,487,000 0.3% $2,493,000 $2,500,000 0.3% KS $88,459,000 9.6% $115,665,000 $169,575,000 $307,684,000 31.5% $309,754,000 $311,871,000 31.5% MO $778,840,000 84.4% $755,543,000 $726,933,000 $613,558,000 62.8% $617,256,000 $621,013,000 62.7% OK $52,259,400 5.7% $61,628,400 $64,557,700 $53,970,700 5.5% $54,171,400 $54,375,000 5.5% Total $922,989,400 100.0% $936,124,400 $964,249,700 $977,699,700 100.0% $983,674,400 $989,759,000 100.0% Scenario 6 High - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $3,431,000 0.4% $3,288,000 $3,131,000 $2,458,000 0.3% $2,465,000 $2,471,000 0.2% KS $88,459,000 9.6% $115,665,000 $185,730,000 $315,469,000 32.3% $317,600,000 $319,775,000 32.3% MO $778,840,000 84.4% $755,543,000 $711,872,000 $606,377,000 62.0% $610,019,000 $613,716,000 62.0% OK $52,259,400 5.7% $61,628,400 $63,514,300 $53,396,100 5.5% $53,592,700 $53,797,200 5.4% Total $922,989,400 100.0% $936,124,400 $964,247,300 $977,700,100 100.0% $983,676,700 $989,759,200 100.0%

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-31 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Capacity with Casino Growth A casino capacity recap showing the impact of the proposed casino expansions and the additions of new casinos is listed in Exhibit 2-34. The bottom line illustrates that slot machines would increase by 58%, pit table games by 54%, poker tables by 21%, total tables by 49%, race book by 200%, and casino square footage by 18%. Other amenities including convention/meeting space would go up by 124%, the number of hotel rooms by 89%, the number of restaurants by 40%, entertainment venues by 53%, and parking capacity by 83%.

Exhibit 2-34 Capacity Listing w/ Casino Growth (Includes the 6 Scenarios)

# of # of # of # of Con- # of Enter- # of # of Pit Poker Total Bingo Race Casino vention # of Restau- tain- Park- Loc Casinos Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing

Capacities for the Existing 18 Casinos 16,914 367 73 440 868 1 717,691 106,520 1,331 52 17 19,150 Scenario 1 - Wyandotte County Proposed

1 Wyandotte County Proposed 3,000 100 0 100 0 0 0 100,000 500 6 5 7,000

Subtotal of Scenario 1 3,000 100 0 100 0 0 0 100,000 500 6 5 7,000 Scenario 2 - Expansions

1 Sac & Fox Casino 500 0 0 0 0 0 0 0 0 0 0 0

Subtotal of Scenario 2 500 0 0 0 0 0 0 0 0 0 0 0 Scenario 3 - Other Proposed

1 Camptown Greyhound Park 600 0 0 0 0 1 0 0 0 2 0 700

2 Cherokee County Planned 1,200 40 0 0 0 0 0 10,000 250 3 2 2,500

3 Downstream Casino Resort 2,000 30 15 45 0 0 70,000 10,000 240 2 0 2,700

4 The Woodlands 800 0 0 0 0 1 0 0 0 4 0 700

5 Wild Rose Entertainment - Sugar Creek 1,200 30 0 30 0 0 40,000 12,000 200 3 2 2,200

6 Wyandotte 7th Street Casino 450 0 0 0 0 0 20,000 0 0 1 0 100

Subtotal of Scenario 3 6,250 100 15 75 0 2 130,000 32,000 690 15 4 8,900

Total Expansions & New Casinos 9,750 200 15 175 0 2 130,000 132,000 1,190 21 9 15,900

Total Existing, Expansions & New 26,664 567 88 615 868 3 847,691 238,520 2,521 73 26 35,050 Scenario 4 - The Woodlands

1 The Woodlands 800 0 0 0 0 1 0 0 0 4 0 700

Subtotal of Scenario 4 800 0 0 0 0 1 0 0 0 4 0 700 Scenario 5 - Expansions

1 Sac & Fox Casino 500 0 0 0 0 0 0 0 0 0 0 0

Subtotal of Scenario 5 500 0 0 0 0 0 0 0 0 0 0 0 Scenario 6 - Other Proposed

1 Camptown Greyhound Park 600 0 0 0 0 1 0 0 0 2 0 700

2 Cherokee County Planned 1,200 40 0 0 0 0 0 10,000 250 3 2 2,500

3 Downstream Casino Resort 2,000 30 15 45 0 0 70,000 10,000 240 2 0 2,700

4 Wild Rose Entertainment - Sugar Creek 1,200 30 0 30 0 0 40,000 12,000 200 3 2 2,200

5 Wyandotte 7th Street Casino 450 0 0 0 0 0 20,000 0 0 1 0 100

6 Wyandotte County Proposed 3,000 100 0 100 0 0 0 100,000 500 6 5 7,000

Subtotal of Scenario 6 8,450 200 15 215 0 1 130,000 132,000 1,190 17 9 15,200

Total Expansions & New Casinos 9,750 200 15 215 0 2 130,000 132,000 1,190 21 9 15,900

16 Total Existing, Expansions & New 26,664 567 88 655 868 3 847,691 238,520 2,521 73 26 35,050 Percent Change Over Current 58% 54% 21% 49% 0% 200% 18% 124% 89% 40% 53% 83%

Data Sources: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 2-32 Kansas Casino Market Study & Gaming Revenue Projections

Section 3

Wells Gaming Research May 2008 Kansas Casino Market Study & Gaming Revenue Projections

Summary for the Trade Area For the Southeast Gaming Zone

Highlights of the gaming market for the southeast trade area follow (refer to pages 3-8 through 3-32 for the corresponding detailed analyses and discussions).

Trade Area The southeast trade area includes the approximate 100-mile radius of the intersection of Kansas, Missouri, and Oklahoma. Included are 65 counties located in southeast Kansas, southwest Missouri, northeast Oklahoma, and northwest Arkansas. The boundaries extend from Miami County, Kansas on the north; to Sequoyah County, Oklahoma on the south; to Osage County, Oklahoma on the west; and to Douglas County, Missouri on the east (refer to the map on page 3-3).

Demographic Statistics The population and median household income statistics that are included in this report are limited to those counties within the gaming zone’s specific trade area, and not for the entire state.

Exhibit 3-1 shows that the southeast trade area includes 65 counties (18 in Kansas, 24 in Missouri, 15 in Oklahoma, and eight in Arkansas). In 2007, these counties had a total adult population of 2.1 million. Median household incomes (MHI) for 2007 ranged from a low of $42.5 thousand in Oklahoma to a high of $47.1 thousand in Arkansas. Kansas came in at $43.1 thousand.

Exhibit 3-1 Adult Population & Median Household Income (MHI)

2007 2007 2012 ACGR Adult # of Adult Population MHI State Counties Population MHI 2012 MHI 07 to 12 07 to 12 KS 18 190,263 $43,094 189,538 $51,650 -0.1% 3.7% MO 24 704,244 $42,508 746,615 $49,083 1.2% 2.9% OK 15 797,857 $47,008 829,285 $54,558 0.8% 3.0% AR 8 380,290 $47,140 432,831 $57,492 2.6% 4.1% Totals 65 2,072,654 NA 2,198,269 NA 1.2% NA

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

The adult population forecast shows an increase from 2.1 million in 2007 to 2.2 million in 2012, an increase of approximately 124 thousand. The resulting average compound growth rate is 1.2%.

May 2008 Wells Gaming Research Page 3-1 Kansas Casino Market Study & Gaming Revenue Projections

The average median household income levels for 2012 are forecasted to range from a low of $49.1 thousand in Missouri to a high of $57.5 thousand in Arkansas. The corresponding average compound growth rates range from a low of 2.9% in Missouri to a high of 4.1% in Arkansas for the 2007 to 2012 period. The average median household income for Kansas was forecasted to average $51.7 thousand, reflecting a 3.7% average compound growth rate.

May 2008 Wells Gaming Research Page 3-2 Southeast Kansas Zone

0 mi 50 100 150 Copyright © and (P) 1988Ð2006 Microsoft Corporation and/or its suppliers. All rights reserved. http://www.microsoft.com/mappoint/ Portions © 1990Ð2005 InstallShield Software Corporation. All rights reserved. Certain mapping and direction data © 2005 NAVTEQ. All rights reserved. The Data for areas of Canada includes information taken with permission from Canadian authorities, including: © Her Majesty the Queen in Right of Canada, © Queen's Printer for Ontario. NAVTEQ and NAVTEQ ON BOARD are trademarks of NAVTEQ. © 2005 Tele Atlas North America, Inc. All rights reserved. Tele Atlas and Tele Atlas North America are trademarks of Tele Atlas, Inc. Kansas Casino Market Study & Gaming Revenue Projections

Primary Market Exhibit 3-2 shows that the southeast trade area is made up of 65 counties. The combined adult population was 2.1 million in 2007. Projections for 2012 show an increase to 2.2 million, with an average compound growth rate of 1.2%.

The primary segment of the southeast trade area is comprised of 11 counties that are contiguous with the intersection of the states of Kansas, Missouri, and Oklahoma. The adult population in the primary market was approximately 255 thousand in 2007 (12% of the total adult population of 2.1 million). By 2012, the adult population for the primary market should reach approximately 262 thousand and continue to represent 12% of the total adult population of 2.2 million. As a group, the 11 counties in the primary market are projected to have an average compound growth rate of 0.5% between 2007 and 2012.

Exhibit 3-2 Adult Population for Primary Market

# of ACGR % Pop/ Counties List of Counties 2007 2012 07 to 12 Co 2012

Bourbon KS 10,509 10,472 -0.1% 4%

Cherokee KS 14,770 14,553 -0.3% 6%

Crawford KS 26,803 27,117 0.2% 10%

Labette KS 15,482 15,396 -0.1% 6%

Neosho KS 10,971 10,560 -0.8% 4%

Barton MO 8,972 9,285 0.7% 4%

Jasper MO 78,643 82,187 0.9% 31%

Newton MO 39,270 41,064 0.9% 16%

Vernon MO 14,058 14,260 0.3% 5%

Craig OK 11,622 12,213 1.0% 5%

Ottawa OK 23,768 24,399 0.5% 9%

11 Total Contiguous Counties 254,869 261,506 0.5% 100% Total Kansas Counties - Excluding Contiguous 13 Counties 111,728 111,440 -0.1% Total Missouri Counties - Excluding Contiguous 20 Counties 563,300 599,818 1.3% Total Oklahoma Counties - Excluding Contiguous 13 Counties 762,467 792,673 0.8%

8 Total Arkansas Counties 380,290 432,831 2.6%

65 Total Trade Area Population 2,072,654 2,198,269 1.2%

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 3-4 Kansas Casino Market Study & Gaming Revenue Projections

Capacity Statistics & Gaming Competition Following in Exhibit 3-3 is a profile of the casino capacity located within a 150-mile radius of the southeast casino site. The existing capacity includes 53 gaming locations equipped with 30,846 slot machines, 591 table games (pit and poker) and 1.4 million square feet of casino space. Other amenities include 75 thousand square feet of convention space, 1,619 hotel rooms, 87 restaurants, 21 entertainment venues, and 35,573 parking spaces.

Exhibit 3-3 Capacity Statistics for 150-Mile Radius from Southeast Zone Casino

Existing Expansions New (Proposed) Casinos Total % Change Capacity Casinos OK KA OK MO Capacity Above Existing # of Loc 53 4 5 9 2 69 1 30% # of Slots 30,846 2,774 7,600 7,740 2,500 51,460 67% # of Tables 591 44 190 169 71 1,065 80% Casino S.F. 1,401,874 10,000 0 260,000 97,000 1,768,874 26% Convention S.F. 74,620 20,000 140,000 30,000 12,000 276,620 271% # of Rooms 1,619 140 1,025 865 200 3,849 138% # of Restaurants 87 2 19 16 5 129 48% Entertainment 21 1 10 5 2 39 86% Parking 35,573 0 14,600 11,074 3,400 64,647 82% Footnote 1. The four expansions in Oklahoma have not been added into the total number of locations.

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

The statistics show that the impact of casino growth within a 150-mile radius will result in a significant escalation in player capacity. Some key capacity changes include the number of gaming locations, up from 53 to 69 (30%). The slot inventory will surge from approximately 31 thousand to 51.5 thousand (67%). The number of table games will increase from 591 to 1,065 (80%). The supply of hotel rooms will go from 1,619 to 3,849 (138%), and the number of restaurants will increase from 87 to 129 (48%).

May 2008 Wells Gaming Research Page 3-5 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Revenues Exhibit 3-4 shows a summary of the revenue flows that correspond to the current status, as well as with three of WGR’s scenarios developed to analyze the potential impacts of the proposed new casinos and expansions on gaming revenues in the southeast trade area. Shown are the states indicating where the gaming revenues come from and where they go. The current status reflects a net loss of $60 million in gaming revenues that flowed out of Kansas into neighboring states in 2007.

Scenarios 1 through 3 illustrate the gaming revenues that have been forecasted for 2012 based on the assumptions set forth in each scenario. The key assumption of scenario 1 is the addition of the Cherokee County Casino. The gaming revenue shows that the Cherokee County Casino has been projected to stem the flow of gaming revenues from Kansas and replace the $60 million loss experienced in 2007 with an $8 million gain.

Exhibit 3-4 Summary of the 2012 Flow of Gaming Revenues (Dollars in Millions)

Current Status 2007 Scenario-1 2012 Scenario-2 2012 Scenario-3 2012 Coming Going Coming Going Coming Going Coming Going State From To Dif From To Dif From To Dif From To Dif AR $172 $0 -$172 $196 $0 -$196 $196 $0 -$196 $207 $0 -$207 IA $0 $1 $1 $0 $1 $1 $0 $1 $1 $0 $1 $1 KA $72 $12 -$60 $73 $81 $8 $73 $77 $4 $80 $112 $31 MO $219 $96 -$122 $238 $96 -$141 $238 $92 -$146 $324 $142 -$182 OK $418 $771 $352 $435 $762 $328 $435 $771 $337 $435 $792 $357 Total $880 $880 $0 $941 $941 $0 $941 $941 $0 $1,046 $1,046 $0

Data Source: Wells Gaming Research, May 2008.

Scenario 2 includes the existing casinos, plus the new Cherokee County Casino discussed in scenario 1 (refer to Exhibit 3-4). In addition, scenario 2 includes six casino expansions: one at the Sac & Fox Casino in Powhattan, Kansas, tentatively scheduled to open in March of 2008; and five expansions that are targeted to open at Oklahoma Tribal casinos between 2008 and 2009. Included are the Creek Nation Casino in Tulsa, Cherokee Casino Resort in Catoosa, Kickapoo Casino in McLoud, Osage Million Dollar Elm in Ponca City, and the Cherokee Casino West Siloam Springs in Watts. Combined, these casino expansions have been forecasted to reduce the difference between the gaming revenues coming from Kansas versus those going to Kansas by $4 million (down from $8 million in Scenario 1 to $4 in Scenario 2).

Scenario 3 includes the casino additions and expansions included in both scenarios 1 and 2, plus 18 new proposed casinos, including the Wyandotte County casino in Kansas City, Kansas and the Sumner County casino south of Wichita. The 18 other proposed casinos have been assumed to be in operation between 2008 and 2010. The gaming revenue estimates developed in scenario 3, based on 2012 mid cases, show that the addition of the Sumner and

May 2008 Wells Gaming Research Page 3-6 Kansas Casino Market Study & Gaming Revenue Projections

Wyandotte County casinos plus the other proposed casinos could increase the net flow of gaming revenues into Kansas by approximately $31 million (an estimated $80 million would come from Kansas while $112 million should stay in Kansas).

Oklahoma is projected to gain revenues in scenario 3 due to the large number of new casinos under construction or planned. Even though Oklahoma’s net gains of $328 million and $337 million in scenarios 1 and 2, respectively, would lag behind the 2007 level of $352 million, the net would increase to $357 million in scenario 3 for a $5 million gain over 2007. However, gaming revenues remaining in Oklahoma would increase by $21 million from $771 in scenario 2 to $792 million in scenario 3.

May 2008 Wells Gaming Research Page 3-7 Kansas Casino Market Study & Gaming Revenue Projections

Detailed Analyses for the Trade Area For the Southeast Gaming Zone

Population statistics were one of the key variables used in the gross gaming revenue projections developed by WGR’s gravity model. The population projections summarized in Exhibit 3-5 show both the total and the adult statistics for the southeast gaming zone.

Exhibit 3-5 Total & Adult Population Statistics

2000 Total & Adult 2007 Total & Adult 2012 Total & Adult Adult as Adult % Adult as Adult % Adult as Adult % # of a % of of Adult a % of of Adult a % of of Adult ST CO Total Adult Total Total Total Adult Total Total Total Adult Total Total

KS 18 275,788 192,501 69.8% 10.1% 272,691 190,263 69.8% 9.2% 271,725 189,538 69.8% 8.6%

MO 24 909,201 639,536 70.3% 33.6% 1,001,878 704,244 70.3% 34.0% 1,062,383 746,615 70.3% 34.0%

OK 15 1,091,005 755,367 69.2% 39.7% 1,152,626 797,857 69.2% 38.5% 1,198,196 829,285 69.2% 37.7%

AR 8 455,687 315,597 69.3% 16.6% 549,285 380,290 69.2% 18.3% 625,250 432,831 69.2% 19.7%

TOT 65 2,731,681 1,903,001 69.7% 100.0% 2,976,480 2,072,654 69.6% 100.0% 3,157,554 2,198,269 69.6% 100.0%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research, May 2008

In 2007, the total population for the southeast trade area was approximately 3.0 million. Of this amount, 2.1 million (69.6%) were adults. State-by-state the adult statistics show 190 thousand for Kansas (9.2% of the adult total), 704 thousand (34.0%) for Missouri, 798 thousand for Oklahoma (38.5%), and 380 thousand for Arkansas (18.3%).

By 2012, the total adult population for the southeast trade area has been forecasted to increase to 2.2 million, approximately 300 thousand above the 2007 level. The statistics show a slight decline in adult population for Kansas, down from 190.3 thousand in 2007 to 189.5 thousand in 2012. Adult population increases between 2007 and 2012 for the other states located within the trade area include Missouri, up from 704 thousand to 736 thousand; Oklahoma, up from 798 thousand to 829 thousand; and Arkansas, up from 380 thousand to 433 thousand.

Due to the age restrictions on casino gaming, only the adult population statistics were used in developing the gross gaming revenue projections in WGR’s gravity model.

May 2008 Wells Gaming Research Page 3-8 Kansas Casino Market Study & Gaming Revenue Projections

Total Population for Surrounding Counties Exhibit 3-6 shows that, as a group, the counties surrounding the southeast casino site had a total population 367 thousand in 2007. Projections for 2012 show an increase to approximately 377 thousand. Jasper County, Missouri had the highest population (114 thousand in 2007, with projections for 119 thousand by 2012). The average compound growth rate for population within the surrounding counties is 0.5%.

The total population for the southeast trade area was approximately 3 million in 2007 with forecasted increases to 3.2 million by 2012. This reflects an average compound growth rate of 1.2%.

Exhibit 3-6 Total Population Statistics

# of ACGR % Pop/ Co Counties 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 Co 2012 Bourbon KS 15,379 15,234 15,222 15,211 15,201 15,189 15,180 15,169 -0.1% 4% Cherokee KS 22,605 21,320 21,257 21,194 21,130 21,067 21,005 20,942 -0.3% 6% Crawford KS 38,242 38,470 38,559 38,649 38,738 38,832 38,920 39,010 0.2% 10% Labette KS 22,835 22,199 22,175 22,148 22,123 22,099 22,075 22,050 -0.1% 6% Neosho KS 16,997 15,905 15,784 15,665 15,544 15,426 15,311 15,193 -0.8% 4% Barton MO 12,541 13,015 13,107 13,199 13,291 13,385 13,474 13,564 0.7% 4% Jasper MO 104,686 112,505 113,538 114,580 115,631 116,693 117,669 118,654 0.9% 32% Newton MO 52,636 56,047 56,560 57,077 57,599 58,126 58,632 59,143 0.9% 16% Vernon MO 20,454 20,455 20,515 20,576 20,636 20,697 20,754 20,810 0.3% 6% Craig OK 14,950 15,856 16,016 16,176 16,338 16,500 16,665 16,832 1.0% 4% Ottawa OK 33,194 34,177 34,356 34,537 34,719 34,900 35,084 35,267 0.5% 9% 11 Total Surrounding Counties 354,519 365,183 367,089 369,012 370,950 372,914 374,769 376,634 0.5% 100% Total Kansas Counties - Excluding Surrounding 13 Counties 159,730 159,794 159,694 159,601 159,519 159,458 159,403 159,361 0.0% Total Missouri Counties - Excluding Surrounding 20 Counties 718,884 787,633 798,158 808,872 819,769 830,864 840,466 850,212 1.3% Total Oklahoma Counties - Excluding Surrounding 13 Counties 1,042,861 1,093,736 1,102,254 1,110,848 1,119,538 1,128,298 1,137,161 1,146,097 0.8% 8 Total Arkansas Counties 455,687 535,413 549,285 563,576 578,307 593,478 609,126 625,250 2.6% 65 Total Trade Area Population 2,731,681 2,941,759 2,976,480 3,011,909 3,048,083 3,085,012 3,120,925 3,157,554 1.2%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 3-9 Kansas Casino Market Study & Gaming Revenue Projections

Adult Population for Surrounding Counties Exhibit 3-7 shows that in 2007 the adult population was 255 thousand for the counties surrounding the casino site. Projections for 2012 indicate an increase to approximately 262 thousand. Jasper County, Missouri, had the highest adult population for a nearby county (79 thousand in 2007 with projections for 82 thousand by 2012). The average compound growth rate for population within the surrounding counties as a group is 0.5%.

Overall, the adult population for the southeast trade area was approximately 2 million for 2007 with projections for 2.2 million by 2012. The resulting average compound growth rate is 1.2%.

Exhibit 3-7 Adult Population Statistics

# of ACGR % Pop/ Co Counties 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 Co 2012 Bourbon KS 10,617 10,516 10,509 10,501 10,495 10,486 10,479 10,472 -0.1% 4% Cherokee KS 15,708 14,815 14,770 14,729 14,683 14,640 14,595 14,553 -0.3% 6% Crawford KS 26,583 26,741 26,803 26,868 26,927 26,993 27,054 27,117 0.2% 10% Labette KS 15,943 15,497 15,482 15,464 15,445 15,430 15,413 15,396 -0.1% 6% Neosho KS 11,814 11,055 10,971 10,887 10,804 10,722 10,643 10,560 -0.8% 4% Barton MO 8,585 8,909 8,972 9,035 9,098 9,163 9,224 9,285 0.7% 4% Jasper MO 72,512 77,928 78,643 79,365 80,093 80,829 81,505 82,187 0.9% 31% Newton MO 36,546 38,914 39,270 39,629 39,992 40,358 40,709 41,064 0.9% 16% Vernon MO 14,016 14,017 14,058 14,100 14,141 14,183 14,222 14,260 0.3% 5% Craig OK 10,848 11,505 11,622 11,737 11,855 11,973 12,091 12,213 1.0% 5% Ottawa OK 22,965 23,644 23,768 23,895 24,020 24,146 24,272 24,399 0.5% 9% 11 Total Surrounding Counties 246,137 253,541 254,869 256,211 257,553 258,922 260,206 261,506 0.5% 100% Total Kansas Counties - Excluding Surrounding 13 Counties 111,836 111,808 111,728 111,653 111,585 111,529 111,485 111,440 -0.1% Total Missouri Counties - Excluding Surrounding 20 Counties 507,877 555,911 563,300 570,821 578,470 586,258 592,988 599,818 1.3% Total Oklahoma Counties - Excluding Surrounding 13 Counties 721,554 756,598 762,467 768,379 774,374 780,394 786,508 792,673 0.8% 8 Total Arkansas Counties 315,597 370,689 380,290 390,175 400,370 410,853 421,680 432,831 2.6% 65 Total Trade Area Population 1,903,001 2,048,547 2,072,654 2,097,239 2,122,352 2,147,956 2,172,867 2,198,269 1.2%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 3-10 Kansas Casino Market Study & Gaming Revenue Projections

Average Median Household Income Exhibit 3-8 shows the average median household income (AMHI) statistics for the southeast trade area. State-by-state, the 2007 statistics show $43 thousand for Kansas, $42.5 thousand for Missouri, $47 thousand for Oklahoma, and $47 thousand for Arkansas. Assuming an average compound growth rate of 3.7% for Kansas, the average median household income would increase to approximately $52 thousand by 2012. The average median household income for Missouri would increase to $49 thousand with an average compound growth rate of 2.9%, Oklahoma would move up to $55 thousand with an average compound growth rate of 3.0%, and Arkansas would go up to $57.5 thousand with an average compound growth rate of 4.1%.

Exhibit 3-8 Average Median Household Income Statistics

# of ACGR Co State 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12

18 Kansas $33,525 $41,572 $43,094 $44,676 $46,319 $48,028 $49,804 $51,650 3.7%

24 Missouri $34,628 $41,304 $42,508 $43,748 $45,024 $46,338 $47,691 $49,083 2.9%

15 Oklahoma $38,298 $45,640 $47,008 $48,420 $49,880 $51,388 $52,947 $54,558 3.0%

8 Arkansas $35,686 $45,304 $47,140 $49,049 $51,036 $53,103 $55,254 $57,492 4.1%

Data Sources: Bureau of Business & Economics, University of Nevada, Reno & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 3-11 Kansas Casino Market Study & Gaming Revenue Projections

2007 Status Quo for the Southeast Trade Area

Status Quo Casino Revenues Exhibit 3-9 shows that the status quo casino gaming revenues were $880 million ($199 million for the Oklahoma Tribal casinos located within 50 miles, and approximately $681 million for other casinos competing within the southeast trade area). Without any casino expansions or additions, gaming revenues could be expected to increase to an estimated $912 million by 2010 and to $934 million by 2012.

Exhibit 3-9 Status Quo (2007 to 2012) Revenues for the Southeast Trade Area

Revenue 2007 2008 2009 2010 2011 2012

Ok Tribal Casinos w/I 50 Miles $199,094,000 $201,741,000 $204,446,000 $207,214,000 $209,938,000 $212,725,000 Other Casinos Competing Within Trade Area $681,208,000 $689,000,000 $696,962,000 $705,061,000 $713,103,000 $721,294,000

Grand Total $880,302,000 $890,741,000 $901,408,000 $912,275,000 $923,041,000 $934,019,000

Data Source: Wells Gaming Research, April 2008.

Status Quo for Visitors The status quo casino visitor counts for 2007 were approximately 14 million (three million within a 50 mile radius and approximately 11 million for other competing casinos). Without any casino expansions or additions, the gaming visitors counts have been projected to increase to 14.4 million by 2012.

Exhibit 3-10 Status Quo Visitors (2007 to 2012) for the Southeast Trade Area

Visitors 2007 2008 2009 2010 2011 2012

Ok Tribal Casinos w/I 50 Miles 2,896,293 2,934,676 2,973,877 3,014,050 3,053,784 3,094,416 Other Casinos Competing Within Trade Area 10,723,310 10,843,085 10,965,502 11,089,906 11,214,226 11,340,834

Total 13,619,603 13,777,761 13,939,379 14,103,956 14,268,010 14,435,250

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-12 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo Gaming Revenue Flows Exhibit 3-11, upper section, profiles where the $880 million in gaming revenues for 2007 was generated. Included were $172 million for Arkansas, $72 million for Kansas, $219 million for Missouri, and $418 million for Oklahoma.

Of the $880 million total, an estimated $1.4 million went to Iowa, $11.9 million to Kansas, $96 million to Missouri, and $771 million to Oklahoma Tribal casinos (refer to the lower section of Exhibit 3-11).

Exhibit 3-11 Status Quo (2007 to 2012) Revenue Flows for the Southeast Trade Area

Current Scenario Revenues Coming From State 2007 2008 2009 2010 2011 2012

AR $171,607,994 $176,210,374 $180,958,899 $185,844,546 $190,891,448 $196,093,017

KS $71,888,705 $71,834,865 $71,779,428 $71,734,110 $71,691,363 $71,649,578

MO $218,630,803 $221,308,664 $224,026,905 $226,787,792 $229,230,335 $231,699,727

OK $418,175,692 $421,387,294 $424,642,871 $427,911,797 $431,229,530 $434,576,446

Total $880,303,194 $890,741,197 $901,408,103 $912,278,245 $923,042,676 $934,018,768

Current Scenario Revenues Going To State 2007 2008 2009 2010 2011 2012 IA $1,427,000 $1,444,000 $1,461,000 $1,479,000 $1,496,000 $1,513,000

KS $11,943,000 $12,064,000 $12,187,000 $12,313,000 $12,431,000 $12,550,000

MO $96,292,000 $97,464,000 $98,656,000 $99,870,000 $100,977,000 $102,100,000

OK $770,640,000 $779,769,000 $789,104,000 $798,613,000 $808,137,000 $817,856,000

Total $880,302,000 $890,741,000 $901,408,000 $912,275,000 $923,041,000 $934,019,000

Data Source: Wells Gaming Research, April 2008.

Without any new casino development in Kansas, the current trends are likely to continue. The status quo flow for casino revenue for 2012 shows what could be expected. Of the $72 million in gaming revenues forecasted for the southeast Kansas trade area, only $12 million would stay in Kansas, resulting in a $60 million net loss.

May 2008 Wells Gaming Research Page 3-13 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo Casino Capacity

Exhibit 3-12 shows that 53 casinos are currently located within approximately 150 miles of the southeast zone casino site. Total gaming capacity includes 30,846 slots, 409 pit table games, 182 poker tables, 3,180 bingo seats, 6 race books, and 1,401,874 square feet of casino space. Other amenities include 74,620 square feet of convention/meeting space, 1,619 hotel rooms, 87 restaurants, 21 entertainment venues, and 35,573 parking spaces.

Exhibit 3-12 Status Quo (2007) Casino Capacity Statistics

# of # of # of Con- # of Enter- # of # of # of Pit Poker Total Bingo Race Casino vention # of Restau- tain- Park- Loc Casino Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing Missouri: 1 Ameristar Casino Hotel - Kansas City 3,016 90 15 105 0 0 140,000 14,520 184 11 3 2,660 2 Argosy Riverside Casino Hotel & Spa 1,924 39 8 47 0 0 62,000 18,000 258 5 3 2,700 3 Harrah's North Kansas City Casino & Hotel 1,793 60 12 72 0 0 60,133 10,000 392 6 1 3,122 4 Isle of Capri Casino - Kansas City 1,525 26 6 32 0 0 40,000 0 0 5 1 1,618 Subtotal of Missouri 8,258 215 41 256 0 0 302,133 42,520 834 27 8 10,100 Oklahoma: 1 7 Clans Paradise Casino 700 8 6 14 0 0 30,000 0 0 2 0 500 2 Blue Ribbon Downs 250 0 0 0 0 1 7,150 2,000 0 1 1 1,640 3 Blue Star Gaming and Casino 228 0 0 0 300 0 20,000 0 0 1 0 500 4 Bordertown Bingo & Casino 886 11 10 21 650 1 73,000 0 0 2 0 400 5 Buffalo Run Casino 1,300 20 9 29 0 0 70,000 10,000 0 3 1 1,300 6 Catoosa Smoke Shop 75 0 0 0 0 0 1,728 0 0 0 0 42 7 Checotah Indian Community Bingo 158 0 0 0 400 0 9,000 0 0 1 0 250 8 Cherokee Casino - Fort Gibson 295 0 0 0 0 0 7,430 0 0 0 0 182 9 Cherokee Casino - Roland 614 6 6 12 0 0 34,375 0 44 1 0 594 10 Cherokee Casino - Sallisaw 251 4 2 6 0 0 27,500 0 0 1 1 250 11 Cherokee Casino - Tahlequah 405 6 3 9 0 0 20,000 0 0 1 0 433 12 Cherokee Casino - West Siloam Springs 1,014 12 12 24 0 0 50,000 0 0 2 1 1,174 13 Cherokee Casino - Will Rogers Downs 250 0 0 0 0 1 18,277 11,000 450 1 1 150 14 Cherokee Casino Resort 1,522 37 35 72 0 0 95,000 7,500 263 8 3 3,100 15 Choctaw Casino - Pocola 1,152 9 0 9 0 1 87,573 0 0 3 1 890 16 Cimarron Bingo Casino 363 0 0 0 0 1 9,600 0 0 1 0 400 17 Creek Nation Casino Eufaula 240 0 0 0 0 0 7,400 0 0 0 0 200 18 Creek Nation Casino Muscogee 584 7 10 17 300 0 30,000 0 0 1 1 800 19 Creek Nation Casino Okemah 132 0 3 3 110 0 1,800 0 0 0 0 200 20 Creek Nation Casino Okmulgee 334 2 3 5 0 0 11,000 0 0 1 0 600 21 Creek Nation Casino Tulsa 1,512 11 11 0 0 38,000 0 0 1 0 2,000 22 Creek Nation Travel Plaza 43 0 0 0 0 0 920 0 0 1 0 50 23 Duck Creek Casino 268 0 0 0 120 0 5,000 0 0 1 0 300 24 Eastern Shawnee Travel Plaza 186 0 0 0 0 0 3,000 0 0 0 0 150 25 Golden Pony Casino 400 0 0 0 0 0 10,000 0 0 1 0 500 26 Grand Lake Casino 879 10 6 16 0 0 45,000 0 0 1 1 1,000 27 High Winds Casino 500 8 0 8 0 0 35,000 0 0 2 0 450 28 Kaw Southwind Casino 1,078 3 4 7 700 0 55,000 0 0 2 0 1,000 29 Keetoowah Cherokee Casino 500 0 0 0 0 0 18,000 0 0 1 0 300 30 Lucky Turtle Casino 101 0 0 0 0 0 3,000 0 0 1 0 200 31 Miami Tribe Entertainment 107 0 0 0 0 0 0 0 0 0 0 75 32 Muscogee Travel Plaza 129 0 0 0 0 0 3,000 0 0 0 0 50 33 Native Lights Casino 612 6 0 6 0 0 22,500 0 0 2 0 405

May 2008 Wells Gaming Research Page 3-14 Kansas Casino Market Study & Gaming Revenue Projections

Exhibit 3-12 Key Casino Capacity Statistics (Continued)

# of # of # of Con- # of Enter- # of # of # of Pit Poker Total Bingo Race Casino vention # of Restau- tain- Park- Loc Casino Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing 34 Osage Million Dollar Elm Casino - Bartlesville 575 6 6 12 0 0 42,000 0 0 0 0 700 35 Osage Million Dollar Elm Casino - Hominy 273 1 2 3 0 0 0 0 0 1 0 250 36 Osage Million Dollar Elm Casino - Pawhuska 135 0 0 0 0 0 0 0 0 1 0 50 37 Osage Million Dollar Elm Casino - Ponca City 222 0 0 0 0 0 7,700 0 0 0 0 150 38 Osage Million Dollar Elm Casino - Sand Springs 601 4 0 4 0 0 25,000 0 0 1 0 500 39 Osage Million Dollar Elm Casino - Skiatook 152 0 0 0 0 0 0 0 28 1 0 200 40 Osage Million Dollar Elm Casino - Tulsa 1,267 10 7 17 600 0 47,000 1,600 0 3 1 800 41 Pawnee Trading Post 130 0 0 0 0 0 3,500 0 0 2 0 250 42 Peoria Gaming Center 200 0 0 0 0 0 4,200 0 0 1 0 250 43 Pocola Travel and Smoke Shop 15 0 0 0 0 0 1,666 0 0 0 0 6 44 Quapaw Casino 483 8 1 9 0 0 27,000 0 0 1 1 700 45 Sac and Fox Casino - Stroud 49 0 0 0 0 0 825 0 0 0 0 34 46 The Stables Casino 500 4 0 4 0 1 25,000 0 0 2 0 260 47 Tonkawa Casino 374 4 0 4 0 0 14,437 0 0 1 0 400 48 West Siloam Springs Smoke Shop 44 0 0 0 0 0 2,160 0 0 0 0 88 49 Wyandotte Nation Casino 500 8 5 13 0 0 50,000 0 0 3 0 750

Total Subtotal of Oklahoma 22,588 194 141 335 3,180 6 1,099,741 32,100 785 60 13 25,473

53 Total Existing Casinos 30,846 409 182 591 3,180 6 1,401,874 74,620 1,619 87 21 35,573

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-15 Kansas Casino Market Study & Gaming Revenue Projections

Scenario Results for the Southeast Casino Zone Trade Area

WGR developed six scenarios for the southeast trade area. Summaries of the components of the scenarios, together with the results of WGR’s research and analyses follow.

Scenario 1

Scenario 1 includes the existing casinos in the southeast trade area, together with the proposed generic casino located in Cherokee County that is proposed to commence operations in January of 2010. As proposed, key gaming capacity assumptions for the Cherokee County mid case scenario include 1,200 slot machines and 40 table games. Other amenities include 10,000 square feet of convention/meeting space, 250 hotel rooms, three restaurants, and two entertainment venues (one small and one large). This scenario assumes that no new casino competition in the form of expanded or new casinos will come online, including the slot machines at Camptown Race Track.

Revenue Projections The casino gaming revenue projections shown in Exhibit 3-13 include WGR’s low, mid, and high case forecasts for 2010 and 2012. The mid case projections show total gaming revenues of $919.5 million in 2010 increasing to $941 million by 2012. The Cherokee Casino Resort has been estimated to attract $68 million in gaming revenues in the 2010 mid case, and approximately $69.5 million in the 2012 mid case. Low case estimates are in the $41 to $42 million range while high case estimates are in the $89 to $91 million range.

Exhibit 3-13 Scenario 1 Revenues Scenario 1 Includes Existing Casinos + Other OK + Cherokee County Proposed for 2009

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Cherokee County (Proposed) $0 $41,117,000 $41,940,000 $67,962,000 $69,404,000 $89,316,000 $91,283,000

Oklahoma Tribal Casinos w/i 50 Miles $199,094,000 $186,017,000 $191,146,000 $172,159,000 $177,006,000 $162,019,000 $166,646,000

All Other Casinos $681,208,000 $692,335,000 $708,210,000 $679,348,000 $694,889,000 $668,135,000 $683,371,000

Total Scenario 1 $880,302,000 $919,469,000 $941,296,000 $919,469,000 $941,299,000 $919,470,000 $941,300,000

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-16 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Impacts Exhibit 3-14 profiles the casino gaming revenue impacts anticipated from adding the Cherokee to the southeast trade area. The category captioned Cherokee County Proposed could generate $68 million in 2010 gaming revenues and $69.4 million in 2012. The offset would be felt by other Oklahoma casinos ($35 million in the 2010 mid case), and all other existing casinos (approximately $26 million in 2010). The net gain to the southeast trade area has been estimated at $7.2 million.

Exhibit 3-14 Scenario 1 Revenue Impacts Includes Existing Casinos + Other OK + Cherokee County Proposed for 2009

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Cherokee County (Proposed) $0 $41,117,000 $41,940,000 $67,962,000 $69,404,000 $89,316,000 $91,283,000

Oklahoma Tribal Casinos w/i 50 Miles $0 -$21,197,000 -$21,579,000 -$35,055,000 -$35,719,000 -$45,195,000 -$46,079,000

All Other Casinos $0 -$12,726,000 -$13,084,000 -$25,713,000 -$26,405,000 -$36,926,000 -$37,923,000

Total Scenario 1 $0 $7,194,000 $7,277,000 $7,194,000 $7,280,000 $7,195,000 $7,281,000

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-17 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds The southeast trade area produced $880 million in gaming revenues in 2007 (refer to the first section of Exhibit 3-15 captioned Scenario 1 Revenues Coming From). Of this amount, an estimated $72 million was generated in Kansas, while only $12 million stayed in Kansas. This represents a loss of $60 million (refer to the third section of Exhibit 3-15 captioned Scenario 1 Mid – Revenues Going To). Oklahoma generated $418 million in 2007; however, $771 million flowed back to Oklahoma for a net gain of $353 million. WGR’s 2010 mid case projections for scenario 1 show that the addition of Cherokee County could increase the flow of gaming revenues for Kansas to $79 million, or $67 million over 2007. Even though Oklahoma’s gaming revenues would decrease from $789 million to $744.5 million (mid case 2009 versus 2010), Oklahoma would continue to be the big winner, generating $428 million in 2010 with $744 million flowing to Oklahoma in the mid case, for a net gain $316 million.

Exhibit 3-15 Flows of Gaming Revenue Funds – Coming From & Going To

Scenario 1 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 AR $171,607,994 19.5% $176,210,374 $180,958,899 $185,844,546 20.2% $190,891,448 $196,093,017 20.8% KS $71,888,705 8.2% $71,834,865 $71,779,428 $72,877,762 7.9% $72,835,751 $72,794,759 7.7% MO $218,630,803 24.8% $221,308,664 $224,026,905 $232,833,198 25.3% $235,320,506 $237,835,066 25.3% OK $418,175,692 47.5% $421,387,294 $424,642,871 $427,911,797 46.5% $431,229,530 $434,576,446 46.2% Total $880,303,194 100.0% $890,741,197 $901,408,103 $919,467,303 100.0% $930,277,235 $941,299,288 100.0%

Scenario 1 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,444,000 $1,461,000 $1,425,000 0.2% $1,441,000 $1,457,000 0.2% KS $11,943,000 1.4% $12,064,000 $12,187,000 $53,003,000 5.8% $53,524,000 $54,055,000 5.7% MO $96,292,000 10.9% $97,464,000 $98,656,000 $97,450,000 10.6% $98,533,000 $99,630,000 10.6% OK $770,640,000 87.5% $779,769,000 $789,104,000 $767,591,000 83.5% $776,780,000 $786,154,000 83.5% Total $880,302,000 100.0% $890,741,000 $901,408,000 $919,469,000 100.0% $930,278,000 $941,296,000 100.0%

Scenario 1 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,444,000 $1,461,000 $1,358,000 0.1% $1,374,000 $1,389,000 0.1% KS $11,943,000 1.4% $12,064,000 $12,187,000 $79,343,000 8.6% $80,165,000 $81,006,000 8.6% MO $96,292,000 10.9% $97,464,000 $98,656,000 $94,290,000 10.3% $95,343,000 $96,412,000 10.2% OK $770,640,000 87.5% $779,769,000 $789,104,000 $744,478,000 81.0% $753,398,000 $762,492,000 81.0% Total $880,302,000 100.0% $890,741,000 $901,408,000 $919,469,000 100.0% $930,280,000 $941,299,000 100.0%

Scenario 1 High - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,444,000 $1,461,000 $1,302,000 0.1% $1,316,000 $1,331,000 0.1% KS $11,943,000 1.4% $12,064,000 $12,187,000 $100,270,000 10.9% $101,349,000 $102,450,000 10.9% MO $96,292,000 10.9% $97,464,000 $98,656,000 $91,585,000 10.0% $92,614,000 $93,658,000 9.9% OK $770,640,000 87.5% $779,769,000 $789,104,000 $726,313,000 79.0% $734,997,000 $743,861,000 79.0% Total $880,302,000 100.0% $890,741,000 $901,408,000 $919,470,000 100.0% $930,276,000 $941,300,000 100.0%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-18 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 2

Scenario 2 includes scenario 1, and the proposed expansions at the following casinos located in Kansas and Oklahoma (southeast trade area). The projected start-up dates for the casino expansions are also shown:

Kansas 1. Sac & Fox Casino in Powhattan, KS (March 2008)

Oklahoma 1. Creek Nation Casino in Tulsa, OK (September 2008) 2. Cherokee Casino Resort in Catoosa, OK (January 2009) 3. Kickapoo Casino in McLoud, OK (January 2009) 4. Osage Million Dollar Elm in Ponca City, OK (January 2009) 5. Cherokee Casino West Siloam Springs in Watts, OK (July 2009)

Revenue Projections Exhibit 3-16 shows casino gaming revenue projections for WGR’s low, mid, and high case forecasts for 2010 and 2012. The mid case projections reflect total gaming revenues of $919.5 million in 2010, increasing to $941.3 million by 2012.

Exhibit 3-16 Scenario 2 Revenues Include Scenario 1 + the Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Cherokee County Proposed $0 $38,832,000 $39,578,000 $64,069,000 $65,372,000 $84,107,000 $85,882,000

Oklahoma Tribal Casinos w/i 50 Miles $199,094,000 $170,250,000 $174,731,000 $157,697,000 $161,942,000 $148,585,000 $152,648,000

All Other Casinos $681,208,000 $710,381,000 $726,986,000 $697,699,000 $713,985,000 $686,775,000 $702,772,000

Total Scenario 2 $880,302,000 $919,463,000 $941,295,000 $919,465,000 $941,299,000 $919,467,000 $941,302,000

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-19 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Impacts Overall, the casino gaming revenue impacts to Cherokee County caused by adding expansions at the competing casinos listed on page 3-18 would be limited to a loss of approximately $4 million in the Scenario 2 mid case. The category captioned other existing casinos would most likely pick up approximately $18 to $19 million between 2010 and 2012. The majority of the estimated losses ($14 to $15 million in the mid-case for 2010 and 2012) would be sustained by other Oklahoma casinos and by Oklahoma Tribal casinos (approximately $4 million in both of the subject years).

Exhibit 3-17 Scenario 2 Revenue Impacts include Scenario 1 + Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Cherokee County Proposed $0 -$2,285,000 -$2,362,000 -$3,893,000 -$4,032,000 -$5,209,000 -$5,401,000

Oklahoma Tribal Casinos w/i 50 Miles $0 -$15,767,000 -$16,415,000 -$14,462,000 -$15,064,000 -$13,434,000 -$13,998,000

All Other Casinos $0 $18,046,000 $18,776,000 $18,351,000 $19,096,000 $18,640,000 $19,401,000

Total Scenario 2 $0 -$6,000 -$1,000 -$4,000 $0 -$3,000 $2,000

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-20 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds Exhibit 3-18 shows WGR’s projections for the 2010 shifts in casino revenue flows. The results indicate that Kansas would generate $73 million (refer to the first section captioned Scenario 2 Revenues Coming From). However, $75 million could flow back to Kansas for a net gain of approximately $2 million in the 2010 (refer to the third section of Exhibit 3-18 captioned Scenario 2 Mid - Revenues Going To).

Oklahoma would remain the big winner after the addition of Cherokee County. Oklahoma is estimated to generate $428 million, but receive $753 million in gaming revenues.

Exhibit 3-18 Flows of Gaming Revenue Funds for Scenario 2 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 2 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 AR $171,607,994 19.5% $176,210,374 $180,958,899 $185,844,546 20.2% $190,891,448 $196,093,017 20.8% KS $71,888,705 8.2% $71,834,865 $71,779,428 $72,877,762 7.9% $72,835,751 $72,794,759 7.7% MO $218,630,803 24.8% $221,308,664 $224,026,905 $232,833,198 25.3% $235,320,506 $237,835,066 25.3% OK $418,175,692 47.5% $421,387,294 $424,642,871 $427,911,797 46.5% $431,229,530 $434,576,446 46.2% Total $880,303,194 100.0% $890,741,197 $901,408,103 $919,467,303 100.0% $930,277,235 $941,299,288 100.0%

Scenario 2 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,417,000 $1,345,000 $1,315,000 0.1% $1,330,000 $1,344,000 0.1% KS $11,943,000 1.4% $12,573,000 $12,028,000 $50,594,000 5.5% $51,072,000 $51,560,000 5.5% MO $96,292,000 10.9% $96,200,000 $93,737,000 $92,812,000 10.1% $93,831,000 $94,864,000 10.1% OK $770,640,000 87.5% $780,553,000 $794,296,000 $774,742,000 84.3% $784,040,000 $793,527,000 84.3% Total $880,302,000 100.0% $890,743,000 $901,406,000 $919,463,000 100.0% $930,273,000 $941,295,000 100.0%

Scenario 2 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,417,000 $1,345,000 $1,257,000 0.1% $1,271,000 $1,285,000 0.1% KS $11,943,000 1.4% $12,573,000 $12,028,000 $75,358,000 8.2% $76,108,000 $76,872,000 8.2% MO $96,292,000 10.9% $96,200,000 $93,737,000 $89,995,000 9.8% $90,990,000 $91,999,000 9.8% OK $770,640,000 87.5% $780,553,000 $794,296,000 $752,855,000 81.9% $761,907,000 $771,143,000 81.9% Total $880,302,000 100.0% $890,743,000 $901,406,000 $919,465,000 100.0% $930,276,000 $941,299,000 100.0%

Scenario 2 High - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,417,000 $1,345,000 $1,207,000 0.1% $1,221,000 $1,234,000 0.1% KS $11,943,000 1.4% $12,573,000 $12,028,000 $94,994,000 10.3% $95,975,000 $96,975,000 10.3% MO $96,292,000 10.9% $96,200,000 $93,737,000 $87,578,000 9.5% $88,552,000 $89,540,000 9.5% OK $770,640,000 87.5% $780,553,000 $794,296,000 $735,688,000 80.0% $744,531,000 $753,553,000 80.1% Total $880,302,000 100.0% $890,743,000 $901,406,000 $919,467,000 100.0% $930,279,000 $941,302,000 100.0%

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 3-21 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 3 Scenario 3 includes Scenario 2, as well as the 18 other proposed casinos listed below:

Kansas 1. Camptown Greyhound Park in Frontenac, KS (Jan 2009) 2. The Woodlands in Kansas City, KS (Jan 2009) 3. Sumner County planned in Wellington, KS (Jan 2010) 4. Wyandotte 7th Street Casino in Kansas City, KS (Jan 2008) 5. Wyandotte County planned in Kansas City, KS (Jan 2010)

Missouri 1. Barden Development, Inc. planned in Branson, MO

Oklahoma 1. Downstream Casino Resort in Ottawa, OK (July 2008) 2. First Council Casino in Newkirk, OK (March 2008) 3. Seneca-Cayuga Tribes of Oklahoma planned in Grove, OK (July 2008) 4. Ioway Casino Resort in Lincoln, OK (January 2009) 5. Wild Rose Entertainment planned in Sugar Creek, MO (proposed for January 2010) 6. Muscogee Creek Nation planned in Eufaula, OK (proposed for 2010) 7. Pawnee Nation planned in Chilocco, OK (planned for 2010) 8. Ponca Tribe Oklahoma planned in Ponca City, OK (planned for 2010) 9. Poteau Travel and Smoke Shop in Poteau, OK (planned for 2010) 10. Shawnee Tribe Oklahoma planned in Oklahoma City, OK (planned for 2010) 11. Wichita & Affiliated Tribes planned in Hinton, OK (planned for 2010) 12. Wilburton Travel and Smoke Shop in Wilburton, OK (planned for 2010)

May 2008 Wells Gaming Research Page 3-22 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Projections WGR’s mid case casino gaming revenue projections for scenario 3 are profiled in Exhibit 3- 19. Total gaming revenues for 2010 are forecasted at approximately $1.0 billion with minor increases through 2012.

Exhibit 3-19 Scenario 3 Revenues Include Scenario 2 + Other Proposed Casinos

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Cherokee County Proposed $0 $26,031,000 $26,567,000 $46,957,000 $47,955,000 $64,926,000 $66,338,000

*Camptown Greyhound Park $0 $18,453,000 $18,655,000 $17,768,000 $17,962,000 $17,171,000 $17,358,000

*Proposed Casinos w/i 50 Miles $0 $79,488,000 $81,547,000 $74,230,000 $76,194,000 $70,208,000 $72,096,000

*All Other Proposed Casinos $0 $127,169,300 $130,418,700 $124,552,300 $127,740,700 $122,133,400 $125,265,800

Oklahoma Tribal Casinos w/i 50 Miles $199,094,000 $131,980,000 $135,525,000 $126,520,000 $129,951,000 $121,968,000 $125,299,000

All Other Casinos $681,208,000 $638,647,000 $653,158,000 $631,745,000 $646,062,000 $625,369,000 $639,505,000

Total Scenario 3 $880,302,000 $1,021,768,300 $1,045,870,700 $1,021,772,300 $1,045,864,700 $1,021,775,400 $1,045,861,800

Data Source: Wells Gaming Research, April 2008.

Revenue Impacts Scenario 3 incorporates the addition of the new casino in Cherokee County (scenario 1), the casino expansions (scenario 2), and the 18 new casinos listed in scenario 3 that include slot machines at the Camptown Race Track. The result is a $102 million addition in gaming revenue projections for the southeast trade area. The $125 million in positive impacts flowing to the category called all other proposed casinos is by far the most significant. The proposed new casinos have been estimated to reduce annual gaming revenues at Cherokee County by amounts ranging from $13 million in the low case, to $17 million in the mid case, and $19 million in the high case.

Exhibit 3-20 Scenario 3 Revenue Impacts Include Scenario 2 + Other Proposed Casinos

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Cherokee County Proposed $0 -$12,801,000 -$13,011,000 -$17,112,000 -$17,417,000 -$19,181,000 -$19,544,000

*Camptown Greyhound Park $0 $18,453,000 $18,655,000 $17,768,000 $17,962,000 $17,171,000 $17,358,000

*Proposed Casinos w/i 50 Miles $0 $79,488,000 $81,547,000 $74,230,000 $76,194,000 $70,208,000 $72,096,000

*All Other Proposed Casinos $0 $127,169,300 $130,418,700 $124,552,300 $127,740,700 $122,133,400 $125,265,800

Oklahoma Tribal Casinos w/i 50 Miles $0 -$38,270,000 -$39,206,000 -$31,177,000 -$31,991,000 -$26,617,000 -$27,349,000

All Other Casinos $0 -$71,734,000 -$73,828,000 -$65,954,000 -$67,923,000 -$61,406,000 -$63,267,000

Total Scenario 3 $0 $102,305,300 $104,575,700 $102,307,300 $104,565,700 $102,308,400 $104,559,800

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-23 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow of Funds Exhibit 3-21 shows that the mid case projections for Kansas include the generation of $80 million in gaming revenues for 2010 (refer to the first section captioned Scenario 3 Revenues Coming From). However, due to the expanded gaming activity, as much as $109.5 million could flow back to Kansas (refer to the third section captioned Scenario 3 Mid - Revenues Going To). The result would be a net gain of approximately $29.5 million. Nonetheless, Oklahoma casinos would continue to be the big winner. The Oklahoma portion of the trade area has been projected to generate an estimated $428 million, while Oklahoma casinos receive $773 million in revenues flowing back from the southeast trade area.

Exhibit 3-21 Flows of Gaming Revenue Funds for Scenario 3 Illustrate Where the Gaming Revenues Originated & Where They Went

Scenario 3 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 AR $171,607,994 19.5% $176,210,374 $180,958,899 $196,942,472 19.3% $202,113,354 $207,439,752 19.8% KS $71,888,705 8.2% $73,069,960 $79,814,361 $80,258,196 7.9% $80,208,273 $80,159,359 7.7% MO $218,630,803 24.8% $226,164,686 $235,119,161 $316,601,315 31.0% $320,093,085 $323,627,194 30.9% OK $418,175,692 47.5% $421,447,526 $424,703,647 $427,973,116 41.9% $431,291,392 $434,638,878 41.6% Total $880,303,194 100.0% $896,892,546 $920,596,068 $1,021,775,099 100.0% $1,033,706,104 $1,045,865,183 100.0%

Scenario 3 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,221,000 $1,149,000 $1,129,000 0.1% $1,141,000 $1,154,000 0.1% KS $11,943,000 1.4% $13,207,000 $36,838,000 $90,207,000 8.8% $91,026,000 $91,860,000 8.8% MO $96,292,000 10.9% $86,540,000 $83,026,000 $140,856,000 13.8% $142,640,000 $144,450,000 13.8% OK $770,640,000 87.5% $795,926,000 $799,585,000 $789,576,300 77.3% $798,897,000 $808,406,700 77.3% Total $880,302,000 100.0% $896,894,000 $920,598,000 $1,021,768,300 100.0% $1,033,704,000 $1,045,870,700 100.0%

Scenario 3 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,221,000 $1,149,000 $1,098,000 0.1% $1,110,000 $1,123,000 0.1% KS $11,943,000 1.4% $13,207,000 $36,838,000 $109,471,000 10.7% $110,507,000 $111,560,000 10.7% MO $96,292,000 10.9% $86,540,000 $83,026,000 $138,047,000 13.5% $139,796,000 $141,578,000 13.5% OK $770,640,000 87.5% $795,926,000 $799,585,000 $773,156,300 75.7% $782,294,000 $791,603,700 75.7% Total $880,302,000 100.0% $896,894,000 $920,598,000 $1,021,772,300 100.0% $1,033,707,000 $1,045,864,700 100.0%

Scenario 3 - High Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,427,000 0.2% $1,221,000 $1,149,000 $1,071,000 0.1% $1,082,000 $1,094,000 0.1% KS $11,943,000 1.4% $13,207,000 $36,838,000 $125,949,000 12.3% $127,179,000 $128,429,000 12.3% MO $96,292,000 10.9% $86,540,000 $83,026,000 $135,441,000 13.3% $137,167,000 $138,917,000 13.3% OK $770,640,000 87.5% $795,926,000 $799,585,000 $759,314,400 74.3% $768,276,100 $777,421,800 74.3% Total $880,302,000 100.0% $896,894,000 $920,598,000 $1,021,775,400 100.0% $1,033,704,100 $1,045,861,800 100.0%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-24 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 4 – Camptown Greyhound Park

Scenario 4 includes the current casinos competing within the southeast trade area, together with the mid case projections for Camptown Greyhound Park. Added gaming capacities include 600 slot machines and a race book. Other assumed customer amenities include two restaurants. With the exception of the Camptown Greyhound Park, scenario 4 does not include any new or expanded competition.

Revenue Projections The addition of Camptown Greyhound Park has been projected to generate approximately $24 million in gaming revenues in the mid case. Overall gaming revenues have been projected to increase from $880 million (2007 total) to $928 million in 2010, and to $950 million by 2012.

Exhibit 3-22 Scenario 4 Revenues Include Existing Casinos + Camptown Greyhound Park

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Camptown Greyhound Park $0 $16,200,000 $16,364,000 $24,611,000 $24,901,000 $31,753,000 $32,160,000

Oklahoma Tribal Casinos w/i 50 Miles $199,094,000 $204,284,000 $209,753,000 $200,456,000 $205,869,000 $197,302,000 $202,669,000

All Other Casinos $681,208,000 $707,544,000 $723,752,000 $702,966,000 $719,100,000 $698,976,000 $715,040,000

Total Scenario 4 $880,302,000 $928,028,000 $949,869,000 $928,033,000 $949,870,000 $928,031,000 $949,869,000

Data Source: Wells Gaming Research, April 2008.

Revenue Impacts In the 2010 mid-case, the addition of Camptown Greyhound Park has been estimated to add approximately $16 million to the overall southeast trade area. An estimated $25 million would flow to Camptown Greyhound Park. Market losses would be sustained by Oklahoma Tribal casinos located within 50 miles and all other casinos located in the market.

Exhibit 3-23 Scenario 4 Revenue Impacts Include the Existing Casinos + Camptown Greyhound Park

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Camptown Greyhound Park $0 $16,200,000 $16,364,000 $24,611,000 $24,901,000 $31,753,000 $32,160,000

Oklahoma Tribal Casinos w/i 50 Miles $0 -$2,930,000 -$2,972,000 -$6,758,000 -$6,856,000 -$9,912,000 -$10,056,000

All Other Casinos $0 $2,483,000 $2,458,000 -$2,095,000 -$2,194,000 -$6,085,000 -$6,254,000

Total Scenario 4 $0 $15,753,000 $15,850,000 $15,758,000 $15,851,000 $15,756,000 $15,850,000

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 3-25 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds Exhibit 3-24 illustrates potential revenue flows for scenario 4. The statistics show that Kansas could produce $79 million in gaming revenues (refer to the first section captioned Scenario 4 Revenues Coming From). However, gaming revenue flowing back to Kansas would be limited to approximately $37 million in 2010 (refer to the third section of Exhibit 3-24 captioned Scenario 4 Mid - Revenues Going To). Revenue flows with Camptown Greyhound Park being the only addition to the market would remain relatively proportional for the other states between 2007 and 2010.

Exhibit 3-24 Flows of Gaming Revenue Funds for Scenario 4 Illustrate Where the Gaming Revenues Originated & Where They Went

Scenario 4 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 AR $171,607,994 19.5% $176,210,374 $180,958,899 $185,844,546 20.0% $190,891,448 $196,093,017 20.6% KS $71,888,705 8.2% $71,834,865 $78,858,604 $78,803,487 8.5% $78,750,400 $78,698,535 8.3% MO $218,630,803 24.8% $221,308,664 $232,640,653 $235,468,603 25.4% $237,970,967 $240,500,783 25.3% OK $418,175,692 47.5% $421,387,294 $424,642,871 $427,911,797 46.1% $431,229,530 $434,576,446 45.8% Total $880,303,194 100.0% $890,741,197 $917,101,027 $928,028,433 100.0% $938,842,345 $949,868,781 100.0%

Scenario 4 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,444,000 $1,494,000 $1,512,000 0.2% $1,529,000 $1,546,000 0.2% KS $11,943,000 1.4% $12,064,000 $28,623,000 $28,835,000 3.1% $29,034,000 $29,237,000 3.1% MO $96,292,000 10.9% $97,464,000 $101,036,000 $102,258,000 11.0% $103,368,000 $104,498,000 11.0% OK $770,640,000 87.5% $779,769,000 $785,951,000 $795,423,000 85.7% $804,908,000 $814,588,000 85.8% Total $880,302,000 100.0% $890,741,000 $917,104,000 $928,028,000 100.0% $938,839,000 $949,869,000 100.0%

Scenario 4 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,444,000 $1,466,000 $1,484,000 0.2% $1,501,000 $1,518,000 0.2% KS $11,943,000 1.4% $12,064,000 $36,723,000 $37,002,000 4.0% $37,263,000 $37,527,000 4.0% MO $96,292,000 10.9% $97,464,000 $99,475,000 $100,687,000 10.8% $101,787,000 $102,910,000 10.8% OK $770,640,000 87.5% $779,769,000 $779,433,000 $788,860,000 85.0% $798,286,000 $807,915,000 85.1% Total $880,302,000 100.0% $890,741,000 $917,097,000 $928,033,000 100.0% $938,837,000 $949,870,000 100.0%

Scenario 4 - High Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,444,000 $1,442,000 $1,460,000 0.2% $1,476,000 $1,493,000 0.2% KS $11,943,000 1.4% $12,064,000 $43,597,000 $43,936,000 4.7% $44,254,000 $44,578,000 4.7% MO $96,292,000 10.9% $97,464,000 $98,127,000 $99,330,000 10.7% $100,424,000 $101,536,000 10.7% OK $770,640,000 87.5% $779,769,000 $773,929,000 $783,305,000 84.4% $792,687,000 $802,262,000 84.5% Total $880,302,000 100.0% $890,741,000 $917,095,000 $928,031,000 100.0% $938,841,000 $949,869,000 100.0%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-26 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 5 – Camptown + Expansions

Scenario 5 includes the scenario 4 plus expansions at the following casinos: Kansas 1. Sac & Fox Casino in Powhattan, KS (Mar 2008) Oklahoma 1. Cherokee Casino Resort in Catoosa, OK (January 2009) 2. Kickapoo Casino in McLoud, OK (January 2009) 3. Osage Million Dollar Elm in Ponca City, OK (January 2009) 4. Cherokee Casino West Siloam Springs in Watts, OK (July 2009) 5. Creek Nation Casino in Tulsa, OK (September 2008)

Revenue Projections Exhibit 3-25 profiles gaming revenue projections for scenario 5. Included is scenario 4 plus the casino expansions listed above. WGR’s mid case forecasts show that total gaming revenues for the southeast trade area are projected at $928 million and $950 million in 2010 and 2012, respectively. This compares with an estimated $880 million in 2007.

Exhibit 3-25 Scenario 5 Gaming Revenues Include Scenario 4 + the Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Camptown Greyhound Park $0 $15,585,000 $15,736,000 $23,576,000 $23,841,000 $30,331,000 $30,701,000

Oklahoma Tribal Casinos w/i 50 Miles $199,094,000 $187,005,000 $191,778,000 $183,534,000 $188,263,000 $180,693,000 $185,382,000

All Other Casinos $681,208,000 $725,441,000 $742,353,000 $720,919,000 $737,765,000 $717,004,000 $733,787,000

Total Scenario 5 $880,302,000 $928,031,000 $949,867,000 $928,029,000 $949,869,000 $928,028,000 $949,870,000

Data Source: Wells Gaming Research, April 2008. Revenue Impacts Exhibit 2-26 illustrates that the scenario 5 mid case for 2010 results in a minor negative change of $4 thousand. Camptown Greyhound Park shows a loss of $1 million, while Oklahoma Tribal casinos located within 50 miles reflect projected losses of $17 million. All other casinos have been forecasted to pick up approximately $18 million in gaming revenues.

Exhibit 3-26 Scenario 5 Gaming Revenues Include Scenario 4 + the Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Camptown Greyhound Park $0 -$615,000 -$628,000 -$1,035,000 -$1,060,000 -$1,422,000 -$1,459,000

Oklahoma Tribal Casinos w/i 50 Miles $0 -$17,279,000 -$17,975,000 -$16,922,000 -$17,606,000 -$16,609,000 -$17,287,000

All Other Casinos $0 $17,897,000 $18,601,000 $17,953,000 $18,665,000 $18,028,000 $18,747,000

Total Scenario 5 $0 $3,000 -$2,000 -$4,000 -$1,000 -$3,000 $1,000

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-27 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow of Funds Exhibit 3-27 summarizes the gaming revenue flows for scenario 5. The data shows that Kansas could produce $79 million in gaming revenues (refer to the first section captioned Scenario 5 Revenues Coming From). However, only $36 million is likely to flow back to Kansas (refer to the third section captioned Scenario 5 Mid - Revenues Going To). Even though the forecasted losses to Kansas are substantial, the Scenario 5 results do represent an estimated improvement of approximately $24 million over 2007. In general, revenue flows for scenario 5 remain relatively proportional for the other states between 2007 and 2010.

Exhibit 3-27 Flow of Gaming Revenue Funds for Scenario 5 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 5 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010

AR $171,607,994 19.5% $176,210,374 $180,958,899 $185,844,546 20.0% $190,891,448 $196,093,017 21.1% KS $71,888,705 8.2% $71,834,865 $78,858,604 $78,803,487 8.5% $78,750,400 $78,698,535 8.5% MO $218,630,803 24.8% $221,308,664 $232,640,653 $235,468,603 25.4% $237,970,967 $240,500,783 25.9% OK $418,175,692 47.5% $421,387,294 $424,642,871 $427,911,797 46.1% $431,229,530 $434,576,446 46.8% Total $880,303,194 100.0% $890,741,197 $917,101,027 $928,028,433 100.0% $938,842,345 $949,868,781 102.4%

Scenario 5 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,417,000 $1,378,000 $1,395,000 0.2% $1,410,000 $1,425,000 0.2%

KS $11,943,000 1.4% $12,573,000 $27,874,000 $28,076,000 3.0% $28,263,000 $28,454,000 3.1% MO $96,292,000 10.9% $96,200,000 $96,091,000 $97,241,000 10.5% $98,287,000 $99,347,000 10.7% OK $770,640,000 87.5% $780,553,000 $791,759,000 $801,319,000 86.3% $810,881,000 $820,641,000 88.4% Total $880,302,000 100.0% $890,743,000 $917,102,000 $928,031,000 100.0% $938,841,000 $949,867,000 102.4%

Scenario 5 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,417,000 $1,353,000 $1,369,000 0.1% $1,384,000 $1,399,000 0.2% KS $11,943,000 1.4% $12,573,000 $35,572,000 $35,832,000 3.9% $36,076,000 $36,322,000 3.9%

MO $96,292,000 10.9% $96,200,000 $94,671,000 $95,813,000 10.3% $96,850,000 $97,902,000 10.5% OK $770,640,000 87.5% $780,553,000 $785,505,000 $795,015,000 85.7% $804,531,000 $814,246,000 87.7% Total $880,302,000 100.0% $890,743,000 $917,101,000 $928,029,000 100.0% $938,841,000 $949,869,000 102.4%

Scenario 5 - High Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,417,000 $1,331,000 $1,347,000 0.1% $1,362,000 $1,377,000 0.1% KS $11,943,000 1.4% $12,573,000 $42,072,000 $42,389,000 4.6% $42,682,000 $42,981,000 4.6% MO $96,292,000 10.9% $96,200,000 $93,447,000 $94,579,000 10.2% $95,609,000 $96,654,000 10.4% OK $770,640,000 87.5% $780,553,000 $780,249,000 $789,713,000 85.1% $799,187,000 $808,858,000 87.2% Total $880,302,000 100.0% $890,743,000 $917,099,000 $928,028,000 100.0% $938,840,000 $949,870,000 102.4%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-28 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 6 – Camptown + Expansions + New Casinos

Scenario 6 includes scenario 3 and scenario 5, as well as the following other proposed casinos:

Kansas 1. The Woodlands in Kansas City, KS (January 2009) 2. Cherokee County Planned in Baxter Springs, KS (January 2010) 3. Sumner County Planned in Wellington, KS (January 2010)

Missouri 1. Barden Development, Inc. planned in Branson, MO (planned for 2010)

Oklahoma 1. Downstream Casino Resort in Ottawa, OK (July 2008) 2. First Council Casino in Newkirk, OK (March 2008) 3. Ioway Casino Resort in Lincoln, OK (planned for 2910) 4. Muscogee Creek Nation planned in Eufaula, OK (planned for 2010) 5. Pawnee Nation Planned in Chilocco, OK (planned for 2010) 6. Ponca Tribe Oklahoma planned in Ponca City, OK (planned for 2010) 7. Poteau Travel and Smoke Shop in Poteau, OK (planned or 2010) 8. Seneca-Cayuga Tribes of Oklahoma planned in Grove, OK (July 2008) 9. Shawnee Tribe Oklahoma planned in Oklahoma City, OK 10. Wichita & Affiliated Tribes planned in Hinton, OK 11. Wilburton Travel and Smoke Shop in Wilburton, OK 12. Wild Rose Entertainment planned in Sugar Creek, MO (January 2010) 13. Wyandotte 7th Street Casino in Kansas City, KS (January 2008) 14. Wyandotte County planned in Kansas City, KS (January 2010)

May 2008 Wells Gaming Research Page 3-29 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Projections Exhibit 3-28 profiles the gaming revenue projections for scenario 6. The 2010 and 2012 mid case projections show overall gaming revenue estimates of over $1.0 billion. This represents an increase of approximately $120 million over the 2007 level of $880 million.

Exhibit 3-28 Scenario 6 Revenues Include Scenario 5 + the Other Proposed

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Camptown Greyhound Park $0 $11,626,000 $11,736,000 $17,768,000 $17,962,000 $22,917,000 $23,190,000

*Cherokee County Proposed $0 $47,701,000 $48,706,000 $46,957,000 $47,955,000 $46,380,000 $47,371,000

*Proposed Casinos w/i 50 Miles $0 $75,156,000 $77,131,000 $74,230,000 $76,194,000 $73,493,000 $75,446,000

*All Other Proposed Casinos $0 $125,461,600 $128,664,000 $124,552,300 $127,740,700 $123,740,100 $126,915,400

Oklahoma Tribal Casinos w/i 50 Miles $199,094,000 $127,902,000 $131,349,000 $126,520,000 $129,951,000 $125,418,000 $128,833,000

All Other Casinos $681,208,000 $633,930,000 $648,278,000 $631,745,000 $646,062,000 $629,830,000 $644,109,000

Total Scenario 6 $880,302,000 $1,021,776,600 $1,045,864,000 $1,021,772,300 $1,045,864,700 $1,021,778,100 $1,045,864,400

Data Source: Wells Gaming Research, April 2008.

Revenue Impacts Exhibit 3-29 shows the casino gaming revenue impacts anticipated with the casino additions included in scenario 6. Of the $1.0 billion in total gross gaming revenues projected for 2010, the major distributions would go to the categories captioned all other proposed casinos ($124.6 million) and proposed casinos located within 50 miles ($74 million). Losses of $5.8 million to $5.9 million have been estimated for Camptown Greyhound Park for 2010 and 2012 in the mid case.

Exhibit 3-29 Scenario 6 Revenue Impacts Include Scenario 5 + Other Proposed

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012

*Camptown Greyhound Park $0 -$3,959,000 -$4,000,000 -$5,808,000 -$5,879,000 -$7,414,000 -$7,511,000

*Cherokee County Proposed $0 $47,701,000 $48,706,000 $46,957,000 $47,955,000 $46,380,000 $47,371,000

*Proposed Casinos w/i 50 Miles $0 $75,156,000 $77,131,000 $74,230,000 $76,194,000 $73,493,000 $75,446,000

*All Other Proposed Casinos $0 $125,461,600 $128,664,000 $124,552,300 $127,740,700 $123,740,100 $126,915,400

Oklahoma Tribal Casinos w/i 50 Miles $0 -$59,103,000 -$60,429,000 -$57,014,000 -$58,312,000 -$55,275,000 -$56,549,000

All Other Casinos $0 -$91,511,000 -$94,075,000 -$89,174,000 -$91,703,000 -$87,174,000 -$89,678,000

Total Scenario 6 $0 $93,745,600 $95,997,000 $93,743,300 $95,995,700 $93,750,100 $95,994,400

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-30 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds Exhibit 3-30 profiles the flow of gaming revenues for scenario 6. Projections for 2010 show that Kansas could produce $80 million in gaming revenues (refer to the first section captioned Scenario 6 Revenues Coming From). An estimated $109.5 million could flow backs in the 2010 mid case for a gain of approximately $30 million (refer to the third section captioned Scenario 6 Mid - Revenues Going To). The $109.5 million in flow backs would be approximately $98 million higher than the 2007 level of $12 million. Oklahoma has been projected to generate $428 million in gaming revenues with flow backs of $773 million, a positive difference of $345 million. Missouri has been forecasted to generate an estimated $317 million in 2010 gaming revenues with flow backs limited to $138 million.

Exhibit 3-30 Flows of Gaming Revenue Funds for Scenario 6 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 6 Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 AR $171,607,994 19.5% $176,210,374 $180,958,899 $196,942,472 19.3% $202,113,354 $207,439,752 20.3% KS $71,888,705 8.2% $73,069,960 $79,814,361 $80,258,196 7.9% $80,208,273 $80,159,359 7.8% MO $218,630,803 24.8% $226,164,686 $235,119,161 $316,601,315 31.0% $320,093,085 $323,627,194 31.7% OK $418,175,692 47.5% $421,447,526 $424,703,647 $427,973,116 41.9% $431,291,392 $434,638,878 42.5% Total $880,303,194 100.0% $896,892,546 $920,596,068 $1,021,775,099 100.0% $1,033,706,104 $1,045,865,183 102.4%

Scenario 6 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,221,000 $1,167,000 $1,111,000 0.1% $1,123,000 $1,135,000 0.1% KS $11,943,000 1.4% $13,207,000 $30,417,000 $104,531,000 10.2% $105,530,000 $106,547,000 10.4% MO $96,292,000 10.9% $86,540,000 $84,020,000 $139,091,000 13.6% $140,850,000 $142,638,000 14.0% OK $770,640,000 87.5% $795,926,000 $804,996,000 $777,043,600 76.0% $786,200,300 $795,544,000 77.9% Total $880,302,000 100.0% $896,894,000 $920,600,000 $1,021,776,600 100.0% $1,033,703,300 $1,045,864,000 102.4%

Scenario 6 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,221,000 $1,149,000 $1,098,000 0.1% $1,110,000 $1,123,000 0.1% KS $11,943,000 1.4% $13,207,000 $36,838,000 $109,471,000 10.7% $110,507,000 $111,560,000 10.9% MO $96,292,000 10.9% $86,540,000 $83,026,000 $138,047,000 13.5% $139,796,000 $141,578,000 13.9% OK $770,640,000 87.5% $795,926,000 $799,585,000 $773,156,300 75.7% $782,294,000 $791,603,700 77.5% Total $880,302,000 100.0% $896,894,000 $920,598,000 $1,021,772,300 100.0% $1,033,707,000 $1,045,864,700 102.4%

Scenario 6 High - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2010 IA $1,427,000 0.2% $1,221,000 $1,135,000 $1,088,000 0.1% $1,100,000 $1,112,000 0.1% KS $11,943,000 1.4% $13,207,000 $42,200,000 $113,650,000 11.1% $114,719,000 $115,806,000 11.3% MO $96,292,000 10.9% $86,540,000 $82,158,000 $137,108,000 13.4% $138,852,000 $140,624,000 13.8% OK $770,640,000 87.5% $795,926,000 $795,100,000 $769,932,100 75.4% $779,035,700 $788,322,400 77.2% Total $880,302,000 100.0% $896,894,000 $920,593,000 $1,021,778,100 100.0% $1,033,706,700 $1,045,864,400 102.4%

Data Source: Wells Gaming Research, April 2008.

May 2008 Wells Gaming Research Page 3-31 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Capacity with Casino Growth in the Southeast Trade Area

Exhibit 3-31 recaps the current capacity and shows the impacts of adding new casinos and casino expansions. For ease of reference, the data has been categorized by state.

Exhibit 3-31 Casino Capacity Statistics with Growth

# of # of # of Con- # of Enter- # of # of # of Pit Poker Total Bingo Race Casino vention # of Restau- tain- Park- Loc Casino Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing Current Capacity for Existing Casinos Current Capacity for Existing Casinos Existing 53 Casinos 30,846 409 182 591 3,180 6 1,401,874 74,620 1,619 87 21 35,573 Casino Expansions in Oklahoma Casino Expansions in Oklahoma 1 Cherokee Casino- West Siloam Springs 486 10 0 10 0 0 10,000 20,000 140 1 1 0 2 Cherokee Nation Casino - Tulsa 1,788 34 0 34 0 0 0 0 0 0 0 0 3 Osage Million Dollar Elm - Ponca City 0 0 0 0 0 0 0 0 0 1 0 0 4 Sac & Fox Casino 500 0 0 0 0 0 0 0 0 0 0 0 Total Expansions 2,774 44 0 44 0 0 10,000 20,000 140 2 1 0 Kansas Proposed Casinos Missouri Proposed Casinos 1 Camptown Greyhound Park 600 0 0 0 0 1 0 0 0 2 0 700 2 Cherokee County Planned 1,200 40 0 40 0 0 10,000 250 3 2 2,500 3 Sumner County Planned 2,000 50 0 50 0 0 0 30,000 275 4 3 3,700 4 The Woodlands 800 0 0 0 0 1 0 0 0 4 0 700 5 Wyandotte County Planned 3,000 100 0 100 0 0 100,000 500 6 5 7,000 Total Kansas Proposed Casinos 7,600 190 0 190 0 2 0 140,000 1,025 19 10 14,600 Oklahoma Proposed Casinos 1 Downstream Casino Resort 2,000 30 15 45 0 0 70,000 10,000 240 2 0 2,700 2 First Council Casino 900 8 8 16 0 0 40,000 0 0 2 1 950 3 Ioway Casino Resort 1,500 50 0 50 0 0 0 0 250 3 2 2,500 4 Muscogee Creek Nation 400 6 0 6 0 0 0 0 0 1 0 400 5 Pawnee Nation Chilocco 1,200 24 0 24 0 0 0 0 150 3 1 1,500 6 Ponca Tribe Oklahoma Planned 500 10 0 10 0 0 50,000 20,000 100 2 0 1,200 7 Poteau Travel & Smoke Shop 20 0 0 0 0 0 0 0 0 0 0 12 8 Seneca-Cayuga Tribes of Oklahoma 1,200 18 0 18 0 0 100,000 0 125 3 1 1,800 9 Wilburton Travel & Smoke Shop 20 0 0 0 0 0 0 0 0 0 12 Total Oklahoma Proposed Casinos 7,740 146 23 169 0 0 260,000 30,000 865 16 5 11,074 Missouri Proposed Casinos 1 Barden Development 1,300 41 0 41 0 0 57,000 0 0 2 0 1,200 2 Wild Rose Entertainment - Sugar Creek 1,200 30 0 30 0 0 40,000 12,000 200 3 2 2,200 Total Missouri Proposed Casinos 2,500 71 0 71 0 0 97,000 12,000 200 5 2 3,400 Grand Total 51,460 860 205 1,065 3,180 8 1,768,874 276,620 3,849 129 39 64,647 Percent Increase Over Current 67% 110% 13% 80% 0% 33% 26% 271% 138% 48% 86% 82%

Data Source: Wells Gaming Research, April 2008.

The bottom line of Exhibit 3-31 shows that slot machines would increase by 67%, pit table games by 110%, poker tables by 13%, number of total tables by 80%, race books by 33%, casino square footage by 26%, convention/meeting space by 271%, the number of hotel rooms by 138%, the number of restaurants by 48%, entertainment venues by 86%, and parking capacity by 82%.

May 2008 Wells Gaming Research Page 3-32 Kansas Casino Market Study & Gaming Revenue Projections

Section 4

Wells Gaming Research May 2008 Kansas Casino Market Study & Gaming Revenue Projections

Summary of the Trade Area for the South Central Gaming Zone

Highlights of the market for the south central trade area follow (refer to pages 4-6 though 4- 22 for the corresponding detailed analyses and discussions).

Trade Area The south central trade area covers portions of Kansas and Oklahoma located within the approximate 100-mile radius surrounding Wellington, Kansas. The boundaries extend to Saline and Dickinson Counties, Kansas on the North; Logan and Lincoln Counties, Oklahoma on the South; Kiowa and Comanche Counties, Kansas on the West; and Labette County, Kansas on the East (refer to the map on page 4-2).

Demographic Statistics The population and median household income statistics included in this report section are limited to those counties located in the south central trade area and do not include the entire states of Kansas and Oklahoma.

Exhibit 4-1 shows that the south central trade area includes 53 counties (34 in Kansas and 19 in Oklahoma). In 2007, these counties had a total adult population of approximately 1.5 million. The corresponding median Household Income (MHI) was approximately $50 thousand in Kansas and $47 thousand in Oklahoma.

Exhibit 4-1 Adult Population & Median Household Income (MHI)

2007 2007 2012 ACGR Adult # of Adult Adult Population MHI State Counties Population MHI Population MHI 07 to 12 07 to 12

KS 34 729,120 $50,429 737,115 $58,998 0.22% 3.2%

OK 19 820,137 $47,237 847,642 $54,561 0.66% 2.9%

Total 53 1,549,257 N/A 1,584,757 N/A 0.45% N/A

Data Sources: Bureau of Business & Economics Research, UNR Reno & Wells Gaming Research, May 2008.

The adult population forecasts include a minor increase of approximately 35 thousand between 2007 and 2012, up from 1.5 million to 1.6 million. The corresponding average compound growth rate for the adult population would be 0.45% between 2007 and 2012.

The median household income levels for 2012 have been forecasted at approximately $59 thousand for Kansas and $55 thousand for Oklahoma. This reflects average compound growth rates between 2007 and 2012 of 3.2% for Kansas and 2.9% for Oklahoma.

May 2008 Wells Gaming Research Page 4-1 South Central Kansas Zone

0 mi 50 100 150 Copyright © and (P) 1988Ð2006 Microsoft Corporation and/or its suppliers. All rights reserved. http://www.microsoft.com/mappoint/ Portions © 1990Ð2005 InstallShield Software Corporation. All rights reserved. Certain mapping and direction data © 2005 NAVTEQ. All rights reserved. The Data for areas of Canada includes information taken with permission from Canadian authorities, including: © Her Majesty the Queen in Right of Canada, © Queen's Printer for Ontario. NAVTEQ and NAVTEQ ON BOARD are trademarks of NAVTEQ. © 2005 Tele Atlas North America, Inc. All rights reserved. Tele Atlas and Tele Atlas North America are trademarks of Tele Atlas, Inc. Kansas Casino Market Study & Gaming Revenue Projections

Primary Market The primary market for the south central trade area of Kansas is made up of 10 counties surrounding the proposed casino site in Sumner County. Exhibit 4-2 shows adult population of approximately 500 thousand for the primary market in 2007. The 10 counties combined have been projected to have an average compound growth rate of 0.5% between 2007 and 2012. One-third of the south central zone trade area adult population lives within these ten counties and within 50 miles or less from the assumed generic casino site.

The total adult population has been forecasted at slightly over 1.5 million for 2012 reflecting an average compound growth rate of 0.1% (refer to Exhibit 4-7, page 4-8 for a detailed year by year population statistic from 2006 through 2012).

Exhibit 4-2 Adult Population for the Primary Market

# of ACGR Counties List of Counties 2007 2012 07 to 12 % 2012 Butler KS 46,781 52,348 2.3% 3% Cowley KS 24,502 23,838 -0.5% 2% Harper KS 4,259 4,025 -1.1% 0% Harvey KS 23,641 24,185 0.5% 2% Kingman KS 5,848 5,811 -0.1% 0% Reno KS 42,425 40,200 -1.1% 3% Sedgwick KS 321,246 329,963 0.5% 22% Sumner KS 17,169 16,964 -0.2% 1% Grant OK 3,637 3,637 0.0% 0% Kay OK 10,546 10,675 0.2% 1%

10 Total Surrounding Counties 500,054 511,646 0.5% 34% Total Kansas Counties - Excluding 26 Surrounding Counties 243,249 239,781 -0.3% 16% Total Oklahoma Counties - Excluding 17 Surrounding Counties 768,657 768,657 0.0% 51%

53 Total Trade Area Population 1,511,960 1,520,084 0.1% 100%

Data Sources: Bureau of Business & Economics Research, UNR Reno & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-3 Kansas Casino Market Study & Gaming Revenue Projections

Capacity Statistics & Competition Exhibit 4-3 shows the existing casino capacity and illustrates the increases that are anticipated for the south central trade area. The current capacity includes 54 gaming locations equipped with 28,532 slot machines, 467 table games (pit and poker) and 1.3 million square feet of casino space. Other amenities include 57 thousand square feet of convention space, 741 hotel rooms, 79 restaurants, 15 entertainment venues, and 39,912 thousand parking spaces.

Capacity increases include the expansions at the Sac & Fox Casino in Kansas, and the five casino expansions in Oklahoma. Also included are the 12 new casinos (four in Kansas and eight in Oklahoma).

Exhibit 4-3 Capacity Statistics with Proposed Casino Growth

Existing Expansions New (Proposed) Casinos Total % Change Capacity Casinos KS OK KS OK Capacity Above Existing # of Loc 54 1 5 4 8 72 33% # of Slots 28,532 500 3,681 4600 9,650 46,963 65% # of Tables 467 0 75 110 243 895 92% Casino S.F. 1,318,784 0 252,000 0 260,000 1,830,784 39% Convention S.F. 57,350 0 20,000 45,000 30,000 152,350 166% # of Rooms 741 0 140 625 1,265 2,771 274% # of Restaurants 79 0 6 12 19 116 47% Entertainment 15 0 3 8 11 37 147% Parking 39,912 0 0 8,600 15,800 64,312 61%

Data Source: Wells Gaming Research, May 2008.

The combined impact of the proposed expansions at six casinos and the addition of 12 new casinos will result in substantial increases in casino capacity in the south central trade area. Notable capacity changes shown in Exhibit 4-3 include a 33% increase in the number of gaming locations (up from 54 to 72), a 65% increase in the number of slot machines (up from 29 thousand to 47 thousand), and a 92% increase in the number of table games (up from 467 to 895). In addition, the number of hotel rooms are forecasted to increase by 274% (up from 741 to 2,771), the number of restaurant are estimated to increase by 47% (up from 79 to 116), the number of entertainment venues have been projected to increase by 147% (up from 15 to 37), and parking capacity should increase by 61% (up from 39,912 spaces to 64,312).

May 2008 Wells Gaming Research Page 4-4 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Revenues Exhibit 4-4 shows the revenue flows that correspond to the current status (2007), as well as to the 2012 projections for scenarios 1 through 3. The scenarios were developed to analyze the impact of the expansions and new casinos. Exhibit 4-4 shows, by state, where the revenues came from and where they went. The current status indicates that Kansas suffered a net loss of $224 million in 2007. Of this amount, $1 million went to Iowa, $42 million to Missouri, and $181 million to Oklahoma.

The key assumption of scenario 1 is the addition of Sumner County near the I-35 exit at Wellington. No other new or expanded casinos have been assumed. With Sumner County added in, the net loss for Kansas has been forecasted to decline from $224 million (2007) to $153 million for scenario 1 in 2012. Out of the $153 million, $1 million has been forecasted to go to Iowa, $34 million to Missouri, and $118 million to Oklahoma.

Exhibit 4-4 Summary of the 2012 Flow of Gaming Revenues (Dollars in Millions)

Current Status 2007 Scenario-1 2012 Scenario-2 2012 Scenario-3 2012 Coming Going Coming Going Coming Going Coming Going State From To Dif From To Dif From To Dif From To Dif IA $0 $1 $1 $0 $1 $1 $0 $1 $1 $0 $1 $1 KS $242 $18 -$224 $294 $141 -$153 $294 $137 -$157 $299 $128 -$171 MO $0 $42 $42 $0 $34 $34 $0 $32 $32 $0 $28 $28 OK $424 $605 $181 $438 $556 $118 $438 $562 $124 $438 $580 $142 Total $666 $666 $0 $732 $732 $0 $732 $732 $0 $737 $737 $0

Data Source: Wells Gaming Research, May 2008.

Scenario 2 includes all existing casinos competing in the south central trade area, Sumner County, plus six expansions. Five of these expansions are in Oklahoma (refer to page 4-16 for a list) and one is in Kansas (the Sac & Fox Casino). The Oklahoma expansions have been projected to substantially overshadow the impact of the expansion at the Sac & Fox Casino. As a result, the net loss for Kansas has been projected to be $157 million, $4 million higher than the $153 million loss projected in scenario-1. In contrast, Oklahoma’s net gain is expected to go up to $124 million, $6 million above the $118 million projected in scenario 1.

Scenario 3 includes all of the casino additions and expansions incorporated into scenarios 1 and 2, plus six new casinos proposed for Kansas, two for Missouri, and 11 for Oklahoma (refer to page 4-19 for a list by state). With all of the projected growth in new casinos, the net loss for Kansas has been projected to increase to $171 million in scenario 3, an increase of $14 million in losses over scenario 2. Even so, the scenario 3 losses of $171 million are $53 million less than the $224 million loss sustained in 2007. On the other hand, Oklahoma’s net gain has been projected to increase to $18 million in scenario 3 by absorbing $14 million from Kansas and another $4 million from Missouri.

May 2008 Wells Gaming Research Page 4-5 Kansas Casino Market Study & Gaming Revenue Projections

Detailed Analysis of the Trade Area for the South Central Gaming Zone

Population statistics were one of the key variables used in the gross gaming revenue (GGR) projections developed for the south central gravity model. WGR compiled statistics for the total population, and for the adult population segment located within the 100-mile trade area surrounding Sumner County. Because of the age restrictions on casino gaming, only the adult population statistics were used in the Wells Gaming Research’s gravity model to project gaming revenues.

Total & Adult Population Statistics The total population for the south central trade area was 2.2 million in 2007, with 1.5 million adults (69% of the total). This market included a total population of approximately 1.0 million in Kansas and 1.1 million in Oklahoma.

Exhibit 4-5 Total & Adult Population Statistics

2000 Total & Adult 2007 Total & Adult 2012 Total & Adult Adult % Adult % Adult % # of Adult as a of Adult Adult as a of Adult Adult as a of Adult ST CO Total Adult % of Total Total Total Adult % of Total Total Total Adult % of Total Total KS 34 1,043,904 718,267 68.8% 47.9% 1,060,641 729,120 68.7% 47.1% 1,072,849 737,115 68.7% 46.5%

OK 19 1,127,204 782,730 69.4% 52.1% 1,181,390 820,137 69.4% 52.9% 1,221,225 847,642 69.4% 53.5% TOT 53 2,171,108 1,500,997 69.1% 100.0% 2,242,031 1,549,257 69.1% 100.0% 2,294,074 1,584,757 69.1% 100.0%

Data Source: Wells Gaming Research, May 2008.

The adult population in the south central trade area has been projected to increase from 1.5 million in 2007 to 1.6 million by the year 2012, with 737 thousand adults (46.5%) living in Kansas and 848 thousand (53.5%) in Oklahoma.

May 2008 Wells Gaming Research Page 4-6 Kansas Casino Market Study & Gaming Revenue Projections

Total Population Exhibit 4-6 shows that the population located in the ten counties surrounding Sumner Country totaled 733 thousand in 2007. The corresponding population for 2012 has been forecasted at 750 thousand, reflecting an average annual compound growth rate of 0.5%.

Exhibit 4-6 Total Population Statistics for 2000 and 2006-2012

# of ACGR % Pop/ Co Counties 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 Co 2012 Butler KS 59,482 68,152 69,701 71,285 72,908 74,566 76,262 77,994 2.3% 10% Cowley KS 36,291 35,907 35,709 35,514 35,320 35,127 34,935 34,744 -0.5% 5% Harper KS 6,536 5,965 5,899 5,833 5,767 5,703 5,639 5,576 -1.1% 1% Harvey KS 32,869 33,915 34,070 34,225 34,382 34,537 34,696 34,854 0.5% 5% Kingman KS 8,673 8,403 8,392 8,381 8,370 8,361 8,350 8,339 -0.1% 1% Reno KS 64,790 60,430 59,778 59,138 58,505 57,877 57,256 56,644 -1.1% 8% Sedgwick KS 452,869 471,520 474,057 476,602 479,161 481,729 484,318 486,917 0.5% 65% Sumner KS 25,946 25,441 25,379 25,319 25,258 25,196 25,136 25,076 -0.2% 3% Grant OK 5,144 5,100 5,100 5,100 5,100 5,100 5,100 5,100 0.0% 1% Kay OK 14,833 14,998 15,037 15,074 15,110 15,148 15,185 15,221 0.2% 2% 10 Total Surrounding Co 707,433 729,831 733,122 736,471 739,881 743,344 746,877 750,465 0.5% 100% Total Kansas Counties - Excluding Surrounding 26 Counties 356,448 348,684 347,656 346,639 345,632 344,643 343,676 342,705 -0.3% Total Oklahoma Counties - Excluding Surrounding 17 Counties 1,107,227 1,153,518 1,161,253 1,169,059 1,176,927 1,184,852 1,192,852 1,200,904 0.7% 53 Total Trade Area Pop 2,171,108 2,232,033 2,242,031 2,252,169 2,262,440 2,272,839 2,283,405 2,294,074 0.5%

Data Source: Wells Gaming Research, May 2008.

The total population for the south central trade area was approximately 2.2 million in 2007 with forecasted increases to 2.9 million by 2012. This reflects an average compound growth rate of 0.5%.

May 2008 Wells Gaming Research Page 4-7 Kansas Casino Market Study & Gaming Revenue Projections

Adult Population The adult population for the ten contiguous counties was 500,054 in 2007. Projections indicate that the adult population could reach 511,646 by 2012, thereby reflecting an average compound growth rate of 0.5% per year. The total adult population for the south central trade area was 1.51 million in 2007. With an average compound growth rate of 0.1%, the 2012 adult population would be 1.52 million.

Exhibit 4-7Adult Population Statistics for 2000 and 2006 to 2012

# of ACGR % Pop/ Co Counties 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 Co 2012 Butler KS 39,923 45,743 46,781 47,844 48,936 50,048 51,185 52,348 2.3% 10% Cowley KS 24,901 24,638 24,502 24,370 24,236 24,104 23,971 23,838 -0.5% 5% Harper KS 4,719 4,307 4,259 4,211 4,164 4,118 4,071 4,025 -1.1% 1% Harvey KS 22,808 23,534 23,641 23,749 23,858 23,965 24,076 24,185 0.5% 5% Kingman KS 6,044 5,855 5,848 5,841 5,834 5,826 5,818 5,811 -0.1% 1% Reno KS 45,980 42,885 42,425 41,970 41,519 41,074 40,634 40,200 -1.1% 8% Sedgwick KS 306,890 319,528 321,246 322,973 324,706 326,445 328,201 329,963 0.5% 64% Sumner KS 17,554 17,213 17,169 17,129 17,088 17,047 17,006 16,964 -0.2% 3% Grant OK 3,669 3,637 3,637 3,637 3,637 3,637 3,637 3,637 0.0% 1% Kay OK 10,404 10,520 10,546 10,574 10,598 10,625 10,651 10,675 0.2% 2% 10 Total Surrounding Counties 482,892 497,860 500,054 502,298 504,576 506,889 509,250 511,646 0.5% 100% Total Kansas Counties - Excluding Surrounding 26 Counties 249,448 243,966 243,249 242,533 241,828 241,138 240,465 239,781 -0.3% Total Oklahoma Counties - Excluding Surrounding 17 Counties 768,657 768,657 768,657 768,657 768,657 768,657 768,657 768,657 0.0% 53 Total Trade Area Population 1,500,997 1,510,483 1,511,960 1,513,488 1,515,061 1,516,684 1,518,372 1,520,084 0.1%

Data Source: Wells Gaming Research, May 2008.

Average Median Household Income The average median household income statistics for 2007 show $50 thousand and $47 thousand, respectively, for counties located in Kansas and Oklahoma that fall within the south central trade area. Based on an average compound growth rate of 3.2%, Kansas would have an average median household income of $59 thousand in 2012. With an average compound growth rate of 2.9%, Oklahoma would have an average median household income of $55 thousand.

Exhibit 4-8 Average Median Household Income Statistics for 2000 and 2006 to 2012

# of ACGR Co State 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 34 KS $40,552 $48,880 $50,429 $52,031 $53,687 $55,398 $57,168 $58,998 3.2% 19 OK $38,736 $45,906 $47,237 $48,610 $50,028 $51,491 $53,002 $54,561 2.9%

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-8 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo for the South Central Trade Area

Gaming Revenues The status quo assumes that there will not be any new casinos or casino expansions. The status quo (2007) gaming revenues totaled approximately $666 million for the south central trade area. Over $82 million of the total was generated by Oklahoma Tribal casinos located within 50 miles. Without any casino expansions or additions in the south central trade area, gaming revenues could increase to approximately $684 million by 2012, for a 2.7% change over 2007.

Exhibit 4-9 2007 to 2012 Status Quo Revenues for the South Central Zone

Revenue 2007 2008 2009 2010 2011 2012 Oklahoma Tribal Casinos w/i 50 Miles $82,203,000 $82,497,000 $82,790,000 $83,090,000 $83,395,000 $83,702,000 All Other Casinos $583,803,000 $587,038,100 $590,322,200 $593,636,300 $596,995,400 $600,378,500 Total $666,006,000 $669,535,100 $673,112,200 $676,726,300 $680,390,400 $684,080,500

Data Source: Wells Gaming Research, May 2008.

Visitors The status quo (2007) casino visitors totaled approximately 10.4 million. Absent any casino expansions or additions, casino visitor counts could increase to approximately 10.7 million by 2012, a 2.9% change over 2007.

Exhibit 4-10 2007 to 2012 Status Quo Visitors for the South Central Zone

Visitors 2007 2008 2009 2010 2011 2012

Oklahoma Tribal Casinos w/i 50 Miles 1,184,502 1,188,497 1,192,510 1,196,630 1,200,776 1,204,953

All Other Casinos 9,215,264 9,269,027 9,323,456 9,378,336 9,433,911 9,489,892

Total 10,399,766 10,457,524 10,515,966 10,574,966 10,634,687 10,694,845

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-9 Kansas Casino Market Study & Gaming Revenue Projections

Estimates of Casino Revenue Flows The status quo for casino revenue shows what could be expected if no new casino development occurred in the south central trade area. In 2007, an estimated $666 million was generated in total gaming revenues. Of the $666 million, an estimated $242 million (36%) was generated in Kansas and $424 million (64%) in Oklahoma. However, the vast majority of the $666 million, approximately $605 million (91%), flowed back to Oklahoma leaving $1.3 million (0.2%) for Iowa, $17.9 million (3%) for Kansas, $42.3 million (6%) for Missouri.

Exhibit 4-11 Status Quo Flow of Gaming Revenue Funds for the Southeast Trade Area for 2007 to 2012

Current Scenario Revenues Coming From State 2007 2008 2009 2010 2011 2012 KS $242,053,193 $242,771,774 $243,508,022 $244,259,946 $245,031,932 $245,814,353 OK $423,949,380 $426,764,405 $429,605,224 $432,467,142 $435,357,292 $438,265,147 Total $666,002,573 $669,536,179 $673,113,246 $676,727,088 $680,389,224 $684,079,500

Current Scenarios Revenues Going To State 2007 2008 2009 2010 2011 2012 IA $1,278,000 $1,282,000 $1,287,000 $1,292,000 $1,297,000 $1,302,000 KS $17,915,000 $17,978,000 $18,041,000 $18,106,000 $18,173,000 $18,240,000 MO $42,293,000 $42,439,000 $42,590,000 $42,744,000 $42,900,000 $43,058,000 OK $604,520,000 $607,836,100 $611,194,200 $614,584,300 $618,020,400 $621,480,500 Total $666,006,000 $669,535,100 $673,112,200 $676,726,300 $680,390,400 $684,080,500

Data Source: Wells Gaming Research, May 2008.

Total gaming revenues for the south central trade area have been projected to increase to $677 million by 2010 and to $684 million by 2012, an approximate increase of $18 million between 2007 and 2012. The projected allocations for 2010 and 2012 relative to 2007 show that the distribution could be expected to remain fairly constant.

May 2008 Wells Gaming Research Page 4-10 Kansas Casino Market Study & Gaming Revenue Projections

Current Casino Gaming Capacity For the South Central Trade Area

A compilation of the current casino gaming capacity located within approximately 150 miles of the casino site in the south central zone is shown in Exhibit 4-12. The results indicate that 54 casinos are currently in operation. All are located in Oklahoma.

Exhibit 4-12 Status Quo Casino Capacity Statistics

# of # of # of Con- # of Enter- # of # of # of Pit Poker Total Bingo Race vention # of Restau- tain- Park- Loc Casino Slots Tables Tables Tables Seats Book Casino S.F. S.F. Rooms rants ment ing Oklahoma: 1 7 Clans Paradise Casino 700 8 6 14 0 0 30,000 0 0 2 0 500 2 Blue Star Gaming and Casino 228 0 0 0 300 0 20,000 0 0 1 0 500 3 Bordertown Bingo & Casino 886 11 10 21 650 1 73,000 0 0 2 0 400 4 Buffalo Run Casino 1,300 20 9 29 0 0 70,000 10,000 0 3 1 1,300 5 Catoosa Smoke Shop 75 0 0 0 0 0 1,728 0 0 0 0 42 6 Cherokee Casino - Fort Gibson 295 0 0 0 0 0 7,430 0 0 0 0 182 7 Cherokee Casino - Will Rogers Downs 250 0 0 0 0 1 18,277 11,000 450 1 1 150 8 Cherokee Casino Resort 1,522 37 35 72 0 0 95,000 7,500 263 8 3 3,100 9 Cimarron Bingo Casino 363 0 0 0 0 1 9,600 0 0 1 0 400 10 Creek Nation Casino Muscogee 584 7 10 17 300 0 30,000 0 0 1 1 800 11 Creek Nation Casino Okemah 132 0 3 3 110 0 1,800 0 0 0 0 200 12 Creek Nation Casino Okmulgee 334 2 3 5 0 0 11,000 0 0 1 0 600 13 Creek Nation Casino Tulsa 1,512 0 11 11 0 0 38,000 0 0 1 0 2,000 14 Creek Nation Travel Plaza 43 0 0 0 0 0 920 0 0 1 0 50 15 Duck Creek Casino 268 0 0 0 120 0 5,000 0 0 1 0 300 16 Eastern Shawnee Travel Plaza 186 0 0 0 0 0 3,000 0 0 0 0 150 17 Feather Warrior Casino 89 0 0 0 0 0 2,200 0 0 0 0 59 18 FireLake Casino 800 7 2 9 500 0 50,000 5,000 0 3 0 800 19 FireLake Grand Casino 1,800 23 19 42 0 0 125,000 0 0 5 2 4,000 20 Golden Pony Casino 400 0 0 0 0 0 10,000 0 0 1 0 500 21 Goldsby Gaming Center 182 0 0 0 300 1 15,462 0 0 1 0 300 22 Grand Lake Casino 879 10 6 16 0 0 45,000 0 0 1 1 1,000 23 High Winds Casino 500 8 0 8 0 0 35,000 0 0 2 0 450 24 Kaw Southwind Casino 1,078 3 4 7 700 0 55,000 0 0 2 0 1,000 25 Kickapoo Casino 525 9 0 9 0 0 12,000 0 0 1 0 600 26 Kickapoo Conoco Station 52 0 0 0 0 0 900 0 0 0 0 30 27 Lucky Star Casino - Clinton 423 5 4 9 0 0 13,000 0 0 1 0 400 28 Lucky Star Casino - Concho 930 13 11 24 0 0 40,000 0 0 1 0 1,000 29 Lucky Turtle Casino 101 0 0 0 0 0 3,000 0 0 1 0 200 30 Miami Tribe Entertainment 107 0 0 0 0 0 0 0 0 0 0 75 31 Muscogee Travel Plaza 129 0 0 0 0 0 3,000 0 0 0 0 50 32 Mystic Winds Casino 354 0 0 0 0 0 0 0 0 0 0 50 33 Native Lights Casino 612 6 0 6 0 0 22,500 0 0 2 0 405 34 Newcastle Gaming Center I 1,199 0 0 0 0 0 10,452 0 0 1 0 900 35 Newcastle Gaming Center II 0 14 14 28 0 0 10,521 0 0 0 0 150 36 Osage Million Dollar Elm Casino - Bartlesville 575 6 6 12 0 0 42,000 0 0 0 0 700

May 2008 Wells Gaming Research Page 4-11 Kansas Casino Market Study & Gaming Revenue Projections

Exhibit 4-12 Status Quo Casino Capacity Statistics (Continued)

# of # of # of Con- # of Enter- # of # of # of Pit Poker Total Bingo Race Casino vention # of Restau- tain- Park- Loc Casino Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing Oklahoma: 37 Osage Million Dollar Elm Casino - Hominy 273 1 2 3 0 0 0 0 0 1 0 250 38 Osage Million Dollar Elm Casino - Pawhuska 135 0 0 0 0 0 0 0 0 1 0 50 39 Osage Million Dollar Elm Casino - Ponca City 222 0 0 0 0 0 7,700 0 0 0 0 150 40 Osage Million Dollar Elm Casino - Sand Springs 601 4 0 4 0 0 25,000 0 0 1 0 500 41 Osage Million Dollar Elm Casino - Skiatook 152 0 0 0 0 0 0 0 28 1 0 200 42 Osage Million Dollar Elm Casino - Tulsa 1,267 10 7 17 600 0 47,000 1,600 0 3 1 800 43 Pawnee Trading Post 130 0 0 0 0 0 3,500 0 0 2 0 250 44 Peoria Gaming Center 200 0 0 0 0 0 4,200 0 0 1 0 250 45 Quapaw Casino 483 8 1 9 0 0 27,000 0 0 1 1 700 46 Remington Park 650 0 0 0 0 1 55,000 0 0 3 0 6,700 47 Riverwind Casino 2,317 32 21 53 0 1 76,308 14,000 0 10 3 4,000 48 Sac and Fox Casino - Shawnee 466 5 5 10 0 0 8,600 0 0 1 0 550 49 Sac and Fox Casino - Stroud 49 0 0 0 0 0 825 0 0 0 0 34 50 Seminole Nation Trading Post 200 0 0 0 0 0 3,424 0 0 0 0 125 51 The Stables Casino 500 4 0 4 0 1 25,000 0 0 2 0 260 52 Thunderbird Casino 600 6 2 8 0 1 61,000 8,250 0 3 1 600 53 Tonkawa Casino 374 4 0 4 0 0 14,437 0 0 1 0 400 54 Wyandotte Nation Casino 500 8 5 13 0 0 50,000 0 0 3 0 750 54 Total Existing Casinos 28,532 271 196 467 3,580 8 1,318,784 57,350 741 79 15 39,912

Data Source: Wells Gaming Research, May 2008.

The foregoing data shows that there are currently a total of 54 casinos located in the south central trade area All are located in Oklahoma. Combined capacities for the 54 casinos include 28,532 slot machines, 271 pit table games, and 196 poker tables (467 total table games), 3,580 bingo seats, 8 race books, and 1.3 million square feet of gaming space. Other amenities include over 57 thousand square feet of convention/meeting space, 741 hotel rooms, 79 restaurants, 15 entertainment venues, and approximately 40 thousand parking spaces.

May 2008 Wells Gaming Research Page 4-12 Kansas Casino Market Study & Gaming Revenue Projections

Analyses of the Gaming Revenue Scenarios

Scenario 1

Assumptions Scenario 1 includes the existing casinos, as well as the generic casino proposed for Sumner County. The mid case scenario for the proposed new Sumner County casino includes projected gaming capacity of 2,000 slot machines and 50 table games. Other amenities include 30,000 square feet of convention/meeting space, 275 hotel rooms, four restaurants, and three entertainment venues (two small and one large). The location assumed for this generic casino was near the I-35 exit at Wellington.

Revenue Projections for Scenario 1 Exhibit 4-13 shows the current gaming revenues (2007) for the south central trade area, together with projections for WGR’s low, mid, and high case forecasts for scenario 1. Total gaming revenues have been forecasted at $666 million for 2007. With Sumner County added in, total gaming revenues in the mid case could increase to $724 million for 2010, and again to $732 million for 2012. It should be noted that the same size casino located near the I-35 exit at Mulvane would generate more revenue due to proximity to the more heavily populated Wichita area.

WGR’s projected allocations include $126 million for 2010 and $127 million for 2012 for the category captioned Summer County Proposed. Projections for the category Oklahoma casinos located within 50 miles of the proposed casino site are approximately $61 million in both 2010 and 2012. Projected allocations for all other casinos located in the south central trade area are forecasted to generate approximately $538 million in 2010 increasing to $544 million in 2012.

Exhibit 4-13 Scenario 1 Gaming Revenues Includes Existing Casinos + Sumner County Proposed for 2008

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Sumner County Proposed $0 $84,285,000 $85,053,000 $125,566,000 $126,721,000 $152,419,000 $153,813,000 Oklahoma Tribal Casinos w/in 50 Miles $82,203,000 $70,919,000 $71,430,000 $60,809,000 $61,231,000 $54,436,000 $54,807,000 All Other Casinos $583,803,000 $568,981,500 $575,311,700 $537,810,200 $543,840,400 $517,326,800 $523,176,900 Total Scenario 1 $666,006,000 $724,185,500 $731,794,700 $724,185,200 $731,792,400 $724,181,800 $731,796,900

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-13 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Impacts The category captioned Sumner County Proposed has projected gaming revenue allocations for 2010 of $126 million, increasing to $127 million by 2012. Projected decreases include $22 million for Oklahoma Tribes located within 50 miles, and a $55.8 million decrease in gaming revenues currently flowing to all other casinos located in the south central trade area.

Exhibit 4-14 Scenario 1 Revenue Impacts Includes the Existing Casinos + Sumner County Proposed for 2008

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Sumner County Proposed $0 $84,285,000 $85,053,000 $125,566,000 $126,721,000 $152,419,000 $153,813,000 Oklahoma Tribal Casinos w/in 50 Miles $0 -$12,171,000 -$12,272,000 -$22,281,000 -$22,471,000 -$28,654,000 -$28,895,000 All Other Casinos $0 -$24,654,800 -$25,066,800 -$55,826,100 -$56,538,100 -$76,309,500 -$77,201,600 Total Scenario 1 $0 $47,459,200 $47,714,200 $47,458,900 $47,711,900 $47,455,500 $47,716,400

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-14 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds Exhibit 4-15 shows that, of the total $666 million in gaming revenues for 2007, $242 million (36.3%) was generated by people from Kansas who frequented Oklahoma Tribal casinos located near the southern border of Kansas (refer to the first section of Exhibit 4-15 captioned Scenario 1 Revenues Coming From).

The scenario 1 mid case shows that in 2007 only $18 million of the $666 million stayed in Kansas, $605 million went to Oklahoma Tribal casinos, $42.3 million went to Missouri, and $1.3 million went to Iowa (refer to the mid section of Exhibit 4-15). Refer to the third section of Exhibit 4-15 captioned Scenario 1 Mid - Revenues Going To.

The addition of Sumner County (scenario 1) in the 2010 mid case could result in an important shift in the flow of casino revenues. Of the $292 million projected to be generated in Kansas, $140 million could stay in Kansas. As forecasted, an estimated $550 million would continue to flow to Oklahoma, $34 million to Missouri, and $1 million to Iowa. Assuming no additional competition enters the market, this trend could be expected to continue through 2012.

Exhibit 4-15 Flows of Gaming Revenue Funds for Scenario 1 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 1 - Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $242,053,193 36.3% $242,771,774 $243,508,022 $291,715,359 40.3% $292,616,176 $293,530,157 40.1% OK $423,949,380 63.7% $426,764,405 $429,605,224 $432,467,142 59.7% $435,357,292 $438,265,147 59.9% Total $666,002,573 100.0% $669,536,179 $673,113,246 $724,182,501 100.0% $727,973,468 $731,795,304 100.0%

Scenario 1 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,282,000 $1,287,000 $1,195,000 0.2% $1,198,000 $1,202,000 0.2% KS $17,915,000 2.7% $17,978,000 $18,041,000 $101,094,000 14.0% $101,526,000 $101,961,000 13.9% MO $42,293,000 6.4% $42,439,000 $42,590,000 $39,223,000 5.4% $39,339,000 $39,459,000 5.4% OK $604,520,000 90.8% $607,836,100 $611,194,200 $582,673,500 80.5% $585,905,600 $589,172,700 80.5% Total $666,006,000 100.0% $669,535,100 $673,112,200 $724,185,500 100.0% $727,968,600 $731,794,700 100.0%

Scenario 1 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,282,000 $1,287,000 $1,014,000 0.1% $1,017,000 $1,020,000 0.1% KS $17,915,000 2.7% $17,978,000 $18,041,000 $139,943,000 19.3% $140,557,000 $141,176,000 19.3% MO $42,293,000 6.4% $42,439,000 $42,590,000 $33,528,000 4.6% $33,618,000 $33,710,000 4.6% OK $604,520,000 90.8% $607,836,100 $611,194,200 $549,700,200 75.9% $552,784,300 $555,886,400 76.0% Total $666,006,000 100.0% $669,535,100 $673,112,200 $724,185,200 100.0% $727,976,300 $731,792,400 100.0%

Scenario 1 High - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,282,000 $1,287,000 $897,000 0.1% $900,000 $902,000 0.1% KS $17,915,000 2.7% $17,978,000 $18,041,000 $165,202,000 22.8% $165,927,000 $166,661,000 22.8% MO $42,293,000 6.4% $42,439,000 $42,590,000 $29,835,000 4.1% $29,911,000 $29,988,000 4.1% OK $604,520,000 90.8% $607,836,100 $611,194,200 $528,247,800 72.9% $531,236,800 $534,245,900 73.0% Total $666,006,000 100.0% $669,535,100 $673,112,200 $724,181,800 100.0% $727,974,800 $731,796,900 100.0%

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-15 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 2

Assumptions Scenario 2 includes scenario 1 (existing casinos plus the new generic casino in Sumner County), as well as expansions at the following casinos located in Kansas and Oklahoma:

Kansas 1. Sac & Fox Casino in Powhattan, KS (March 2008)

Oklahoma 1. Cherokee Casino Resort in Catoosa, OK (January 2009) 2. Kickapoo Casino in McLoud, OK (January 2009) 3. Osage Million Dollar Elm in Ponca City, OK (January 2009) 4. Cherokee Casino West Siloam Springs in Watts, OK (July 2009) 5. Creek Nation Casino in Tulsa, OK (September 2008)

Revenue Projections The following casino revenue projections include WGR’s low, mid, and high case forecasts for scenario 2 (includes the addition Sumner County plus the expansions listed in scenario 2). Of the total $724 million forecasted in the mid case for 2010, an estimated $121.2 million would go to the category captioned Sumner County Proposed, increasing slightly to $122.3 million by 2012; $59.4 million would likely go to Oklahoma casinos located within 50 miles; and, $544 million would go to all of the other casinos located in the south central trade area. The combined gaming revenues have been estimated to increase from an estimated $724 million in 2010 to $732 million by 2012, or by 1.1%.

Exhibit 4-16 Scenario 2 Gaming Revenues Include Scenario 1 + Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Sumner County Proposed $0 $80,747,000 $81,479,000 $121,210,000 $122,323,000 $147,766,000 $149,116,000 Oklahoma Tribal Casinos w/in 50 Miles $82,203,000 $68,964,000 $69,455,000 $59,447,000 $59,856,000 $53,378,000 $53,738,000 All Other Casinos $583,803,000 $574,473,800 $580,855,900 $543,525,700 $549,623,800 $523,035,300 $528,941,400 Total Scenario 2 $666,006,000 $724,184,800 $731,789,900 $724,182,700 $731,802,800 $724,179,300 $731,795,400

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-16 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Impacts The net gaming revenue impacts between scenarios 1 and 2 show losses for Sumner County Proposed of $4.4 million and for Oklahoma tribes located within 50 miles of $1.4 million. The all other casinos category has been forecasted to go up by an additional $5.7 million in gaming revenues. The bottom line differences between scenarios 1 and 2 are minor, $2.5 thousand in 2010 and $10.4 thousand in 2012.

Exhibit 4-17 Revenue Impacts – Scenario 2 – Scenario 1 + Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Sumner County Proposed $0 -$3,538,000 -$3,574,000 -$4,356,000 -$4,398,000 -$4,653,000 -$4,697,000 Oklahoma Tribal Casinos w/in 50 Miles $0 -$1,955,000 -$1,975,000 -$1,362,000 -$1,375,000 -$1,058,000 -$1,069,000 All Other Casinos $0 $5,492,300 $5,544,200 $5,715,500 $5,783,400 $5,708,500 $5,764,500 Total Scenario 2 $0 -$700 -$4,800 -$2,500 $10,400 -$2,500 -$1,500

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-17 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds The addition of the scenario 2 casino expansions and Sumner County (scenario 1) could trigger the following casino revenue flows. Kansas has been projected to generate $292 million in the 2010 (refer to the first section of Exhibit 4-18 captioned Scenario 2 Revenues Coming From). The mid case results show that an estimated $136 million has been forecasted to stay in Kansas), while $556 million could flow to Oklahoma, $32 million to Missouri, and $1 million to Iowa (refer to the third section of Exhibit 4-18 captioned Scenario 2 Mid - Revenues Going To). Absent other market changes, this trend could continue through 2012.

Exhibit 4-18 Flow of Gaming Revenue Funds for Scenario 2 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 2 - Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $242,053,193 36.3% $242,771,774 $243,508,022 $291,715,359 40.3% $292,616,176 $293,530,157 40.1% OK $423,949,380 63.7% $426,764,405 $429,605,224 $432,467,142 59.7% $435,357,292 $438,265,147 59.9% Total $666,002,573 100.0% $669,536,179 $673,113,246 $724,182,501 100.0% $727,973,468 $731,795,304 100.0%

Scenario 2 Low - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,246,000 $1,199,000 $1,127,000 0.2% $1,130,000 $1,134,000 0.2% KS $17,915,000 2.7% $18,595,000 $17,940,000 $97,661,000 13.5% $98,074,000 $98,493,000 13.5% MO $42,293,000 6.4% $41,245,000 $39,727,000 $37,013,000 5.1% $37,125,000 $37,236,000 5.1% OK $604,520,000 90.8% $608,456,000 $614,251,100 $588,383,800 81.2% $591,647,800 $594,926,900 81.3% Total $666,006,000 100.0% $669,542,000 $673,117,100 $724,184,800 100.0% $727,976,800 $731,789,900 100.0%

Scenario 2 Mid - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,246,000 $1,199,000 $961,000 0.1% $964,000 $966,000 0.1% KS $17,915,000 2.7% $18,595,000 $17,940,000 $135,746,000 18.7% $136,339,000 $136,938,000 18.7% MO $42,293,000 6.4% $41,245,000 $39,727,000 $31,776,000 4.4% $31,863,000 $31,951,000 4.4% OK $604,520,000 90.8% $608,456,000 $614,251,100 $555,699,700 76.7% $558,811,700 $561,947,800 76.8% Total $666,006,000 100.0% $669,542,000 $673,117,100 $724,182,700 100.0% $727,977,700 $731,802,800 100.0%

Scenario 2 High - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,246,000 $1,199,000 $852,000 0.1% $855,000 $857,000 0.1% KS $17,915,000 2.7% $18,595,000 $17,940,000 $160,725,000 22.2% $161,430,000 $162,142,000 22.2% MO $42,293,000 6.4% $41,245,000 $39,727,000 $28,343,000 3.9% $28,414,000 $28,486,000 3.9% OK $604,520,000 90.8% $608,456,000 $614,251,100 $534,259,300 73.8% $537,274,400 $540,310,400 73.8% Total $666,006,000 100.0% $669,542,000 $673,117,100 $724,179,300 100.0% $727,973,400 $731,795,400 100.0%

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-18 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 3

Scenario 3 includes scenario 2 and the following new casinos that have been proposed for Kansas, Missouri, and Oklahoma:

Kansas 1. Wyandotte 7th Street Casino in Kansas City, KS (January 2008) 2. Camptown Greyhound Park in Frontenac, KS (January 2009) 3. The Woodlands in Kansas City, KS (January 2009) 4. Cherokee County planned in Baxter Springs, KS (January 2010) 5. Wyandotte County planned in Kansas City, KS (January 2010) 6. Ford County planned in Dodge City, KS (proposed for 2010)

Missouri 1. Barden Development, Inc. planned in Branson, MO 2. Wild Rose Entertainment planned in Sugar Creek, MO (Jan 2010)

Oklahoma 1. First Council Casino in Newkirk, OK (March 2008) 2. Downstream Casino Resort in Ottawa, OK (July 2008) 3. Seneca-Cayuga Tribes of Oklahoma planned in Grove, OK (July 2008) 4. Ioway Casino Resort in Lincoln, OK (January 2009) 5. Muscogee Creek Nation planned in Eufaula, OK (proposed for 2010) 6. Pawnee Nation Planned in Chilocco, OK (proposed for 2010) 7. Ponca Tribe Oklahoma planned in Ponca City, OK (proposed for 2010 8. Poteau Travel and Smoke Shop in Poteau, OK (proposed for 2010) 9. Shawnee Tribe Oklahoma planned in Oklahoma City, OK (proposed for 2010) 10. Wichita & Affiliated Tribes planned in Hinton, OK (proposed for 2010) 11. Wilburton Travel and Smoke Shop in Wilburton, OK (proposed for 2010)

May 2008 Wells Gaming Research Page 4-19 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Projections The mid case estimates for scenario 3 with the opening of the 19 new casinos shown on page 4-19 totaled $730.4 million in 2010 increasing to $738 million in 2012. The mid case projections include $93.2 million for Sumner County Proposed, $46.7 million for the casinos proposed within 50 miles, $79.7 million for all other proposed casinos, $42.3 million for Oklahoma casinos located within 50 miles, and $468.6 million for all other casinos in the south central zone. Gaming revenue estimates for Sumner County Proposed (Wellington location) totaled $93 to $94 million in the mid case. The Mulvane location would most likely generates $50 to $60 million more than the Wellington location.

Exhibit 4-19 Revenues – Scenario 3 – Scenario 2 + Other Proposed

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Sumner County Proposed $0 $58,549,000 $59,071,000 $93,228,000 $94,080,000 $117,931,000 $119,012,000 *Proposed Casinos w/in 50 Miles $0 $53,308,000 $53,689,000 $46,679,000 $46,999,000 $42,122,000 $42,401,000 *All Other Proposed Casinos $0 $86,007,900 $86,788,200 $79,673,700 $80,396,100 $75,086,500 $75,767,800 Oklahoma Tribal Casinos w/in 50 Miles $82,203,000 $47,235,000 $47,604,000 $42,287,000 $42,608,000 $38,853,000 $39,141,000 All Other Casinos $583,803,000 $485,335,300 $490,804,400 $468,572,100 $473,871,200 $456,446,300 $461,634,400 Total Scenario 3 $666,006,000 $730,435,200 $737,956,600 $730,439,800 $737,954,300 $730,438,800 $737,956,200

Data Source: Wells Gaming Research, May 2008.

Revenue Impacts Overall, the net gaming revenue impact of adding the casinos proposed in scenario 3 to would result in $6.3 loss in gaming revenues. Negative impacts of scenario 3 over those profiled in scenario 2 include a $28 million decrease for Sumner County in 2010 and 2012, an approximate decline of $17 million for Oklahoma casinos located within 50 miles, and a loss of $74 million in gaming revenues for all other casinos located in the south central trade area. All other proposed casinos have been forecasted to pick up approximately $80 million in gaming revenues.

Exhibit 4-20 Scenario 3 Revenue Impacts Include Scenario 2 + Other Proposed

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Sumner County Proposed $0 -$22,198,000 -$22,408,000 -$27,982,000 -$28,243,000 -$29,835,000 -$30,104,000 *Proposed Casinos w/in 50 Miles $0 $53,308,000 $53,689,000 $46,679,000 $46,999,000 $42,122,000 $42,401,000 *All Other Proposed Casinos $0 $86,007,900 $86,788,200 $79,673,700 $80,396,100 $75,086,500 $75,767,800 Oklahoma Tribal Casinos w/in 50 Miles $0 -$21,729,000 -$21,851,000 -$17,160,000 -$17,248,000 -$14,525,000 -$14,597,000 All Other Casinos $0 -$89,138,500 -$90,051,500 -$74,953,600 -$75,752,600 -$66,589,000 -$67,307,000 Total Scenario 3 $0 $6,250,400 $6,166,700 $6,257,100 $6,151,500 $6,259,500 $6,160,800

Data Sources: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-20 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow Funds Exhibit 4-21 illustrates that the addition of the proposed casinos included in scenario 3 (incorporates the expansions and additions outlined in scenarios 1 and 2) resulted in the following forecasted flow of casino revenues. Out of a total of $730 million in 2010, $298 million has been forecasted to be generated in Kansas and $433 million in Oklahoma (refer to the first section of Exhibit 4-21 captioned Scenario 3 Revenues Coming From). The mid case forecasts shows that only $129 million would stay in Kansas, while $573 million would flow into Oklahoma (refer to the third section of Exhibit 4-21 captioned Scenario 3 Mid - Revenues Going To). Other mid case results include an estimated $28 million flowing to Missouri, and $727 thousand to Iowa. Without any significant changes in the south central trade area, this trend could continue through 2012.

Exhibit 4-21 Flow of Gaming Revenue Funds for Scenario 3 Illustrates Where the Gaming Revenues Came From & Where They Went

Scenario 3 - Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $242,053,193 36.3% $243,429,855 $244,971,726 $297,764,725 40.8% $298,616,770 $299,481,888 40.6% OK $423,949,380 63.7% $426,764,405 $429,708,105 $432,672,430 59.2% $435,564,475 $438,474,269 59.4% Total $666,002,573 100.0% $670,194,260 $674,679,831 $730,437,155 100.0% $734,181,245 $737,956,157 100.0%

Scenario 3 Low - Revenues Going To State 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,107,000 $1,018,000 $817,000 0.1% $819,000 $821,000 0.1% KS $17,915,000 2.7% $17,479,000 $21,279,000 $97,952,000 13.4% $98,302,000 $98,650,000 13.4% MO $42,293,000 6.4% $36,592,000 $33,744,000 $31,106,000 4.3% $31,197,000 $31,287,000 4.2% OK $604,520,000 90.8% $615,018,100 $618,643,400 $600,560,200 82.2% $603,864,400 $607,198,600 82.3% Total $666,006,000 100.0% $670,196,100 $674,684,400 $730,435,200 100.0% $734,182,400 $737,956,600 100.0%

Scenario 3 Mid - Revenues Going To State 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,107,000 $1,018,000 $727,000 0.1% $729,000 $731,000 0.1% KS $17,915,000 2.7% $17,479,000 $21,279,000 $128,731,000 17.6% $129,224,000 $129,724,000 17.6% MO $42,293,000 6.4% $36,592,000 $33,744,000 $27,816,000 3.8% $27,890,000 $27,965,000 3.8% OK $604,520,000 90.8% $615,018,100 $618,643,400 $573,165,800 78.5% $576,340,100 $579,534,300 78.5% Total $666,006,000 100.0% $670,196,100 $674,684,400 $730,439,800 100.0% $734,183,100 $737,954,300 100.0%

Scenario 3 High - Revenues Going To State 2007 2008 2009 2010 % 2010 2011 2012 % 2012 IA $1,278,000 0.2% $1,107,000 $1,018,000 $662,000 0.1% $664,000 $666,000 0.1% KS $17,915,000 2.7% $17,479,000 $21,279,000 $150,612,000 20.6% $151,207,000 $151,808,000 20.6% MO $42,293,000 6.4% $36,592,000 $33,744,000 $25,453,000 3.5% $25,517,000 $25,581,000 3.5% OK $604,520,000 90.8% $615,018,100 $618,643,400 $553,711,800 75.8% $556,789,000 $559,901,200 75.9% Total $666,006,000 100.0% $670,196,100 $674,684,400 $730,438,800 100.0% $734,177,000 $737,956,200 100.0%

Data Source: Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 4-21 Kansas Casino Market Study & Gaming Revenue Projections

Current & Proposed Casino Capacity

Exhibit 4-22 recaps casino capacity and illustrates what could be expected with the proposed casino additions and expansions.

Exhibit 4-22 Casino Capacity Including Proposed Growth

# of # of # of # of Con- # of Enter- # Of # of Pit Poker Total Bingo Race Casino vention # of Restau- tain- Park- Loc Casinos Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing

Current Capacity for Existing Casinos 54 Existing Casinos 28,532 271 196 467 3,580 8 1,318,784 57,350 741 79 15 39,912

Casino Expansions in Kansas 1 Sac & Fox Casino - Powhattan 500 0 0 0 0 0 0 0 0 0 0 0 Total Kansas Expansions 500 0 0 0 0 0 0 0 0 0 0 0

Casino Expansions in Oklahoma 1 Cherokee Casino- West Siloam Springs 486 10 0 10 0 0 10,000 20,000 140 1 1 0 2 Cherokee Nation Casino - Tulsa 1,788 34 0 34 0 0 0 0 0 0 0 0 3 Kickapoo Casino - McLoud 675 31 0 31 0 0 0 0 0 2 0 0 4 Osage Million Dollar Elm - Ponca City 0 0 0 0 0 0 0 0 0 1 0 0 5 Cherokee Casino Resort-Catoosa 732 0 0 0 0 242,000 0 0 2 2 0 Total Oklahoma Expansions 3,681 75 0 75 0 0 252,000 20,000 140 6 3 0

Kansas Proposed Casinos 1 Sumner County Planned 2,000 50 0 50 0 0 0 30,000 275 4 3 3,700 2 Camptown Greyhound Park 600 0 0 0 0 1 0 0 0 2 0 700 3 Cherokee County Planned 1,200 40 0 40 0 0 0 10,000 250 3 2 2,500 4 Ford County Planned 800 20 0 20 0 0 5,000 100 3 3 1,700 Total Kansas Proposed Cassinos 4,600 110 0 110 0 1 0 45,000 625 12 8 8,600

Oklahoma Proposed Casinos 1 Downstream Casino Resort 2,000 30 15 45 0 0 70,000 10,000 240 2 0 2,700 2 First Council Casino 900 8 8 16 0 0 40,000 0 0 2 1 950 3 Ioway Casino Resort 1,500 50 0 50 0 0 0 0 250 3 2 2,500 4 Pawnee Nation Chilocco 1,200 24 0 24 0 0 0 0 150 3 1 1,500 5 Ponca Tribe Oklahoma Planned 500 10 0 10 0 0 50,000 20,000 100 2 0 1,200 6 Seneca-Cayuga Tribes of Oklahoma 1,200 18 0 18 0 0 100,000 0 125 3 1 1,800 7 Shawnee Tribe Oklahoma Planned 2,000 75 0 75 0 0 0 400 3 6 4,800 8 Wichita & Affiliated Tribes Planned 350 5 0 5 0 0 0 0 0 1 0 350 Total Kansas Proposed Cassinos 9,650 220 23 243 0 0 260,000 30,000 1,265 19 11 15,800

72 Grand Total 46,963 676 219 895 3,580 9 1,830,784 152,350 2,771 116 37 64,312

Percent Increase Over Current 65% 149% 12% 92% 0% 13% 39% 166% 274% 47% 147% 61%

Data Source: Wells Gaming Research, May 2008.

The grand total and the percent increase lines reflect the capacity increases that could be anticipated if all of the proposed casino additions and expansions take place. The number of casino locations would increase from 54 to 72. Key gaming capacity changes include a 65% increase in slot machines, a 92% increase in the total number of table games, and a 39% expansion in casino square footage. Other amenities include a 166% expansion in convention/meeting space, a 274% escalation in hotel rooms, a 47 % increase in the number of restaurants, a 147% increase in the number of entertainment venues, and a 61% increase in parking capacity.

May 2008 Wells Gaming Research Page 4-22 Kansas Casino Market Study & Gaming Revenue Projections

Section 5

Wells Gaming Research May 2008 Kansas Casino Market Study & Gaming Revenue Projections

Summary of the Trade Area For the Southwest Gaming Zone

Highlights of WGR’s study on the southwest trade area (Ford County) are presented directly below (refer to pages 5-6 through 5-17 for the corresponding detailed analyses and discussions).

Trade Area The southwest trade area includes an approximate 100-mile radius of Dodge City, Kansas. It extends to Sheridan and Graham Counties, Kansas on the north; the Texas panhandle on the south taking in parts of Ochiltree and Lipscomb Counties, Texas, as well as Ellis County, Oklahoma on the south; Hamilton, Stanton, and Morton Counties in Kansas on the west (near the Colorado border); and Reno County, Kansas on the east. (For reference, refer to the map on page 5-2).

Demographic Statistics The population and median household income statistics included in this report are limited to those counties included in the southwest trade area and are not representative of the entire states of Kansas, Oklahoma, or Texas.

Exhibit 5-1 shows that the southwest trade area includes 60 counties (51 in Kansas, seven in Oklahoma, and two in Texas). In 2007, these counties had a total adult population of 343 thousand. Median household incomes (MHI) ranged from a little over $38 thousand in Oklahoma, to approximately $44 thousand in Kansas, and $45 thousand in Texas.

Exhibit 5-1 Adult Population & Median Household Income (MHI)

2007 2007 2012 ACGR Adult # of Adult Adult Population MHI State Counties Population MHI Population MHI 07 to 12 07 to 12

KS 51 284,463 $43,822 280,482 $50,930 -0.3% 3.1%

OK 7 50,021 $38,196 52,359 $42,358 0.9% 2.1%

TX 2 8,518 $44,958 8,919 $52,000 0.9% 3.0%

Total 60 343,002 NA 341,760 NA -0.1% NA

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

Adult population forecasts for 2012 were slightly lower than 2007, approximately 342 thousand (the minor decline is expected in Kansas). The resulting average compound growth rate (ACGR) for adult population is slightly negative (0.1%) for the 2007 and 2012 period. The median household income levels for 2012 are forecasted at $42 thousand in Oklahoma, $51 thousand in Kansas, and $52 thousand in Texas. The average compound growth rate for

May 2008 Wells Gaming Research Page 5-1 Southwest Kansas Zone

0 mi 50 100 150 Copyright © and (P) 1988Ð2006 Microsoft Corporation and/or its suppliers. All rights reserved. http://www.microsoft.com/mappoint/ Portions © 1990Ð2005 InstallShield Software Corporation. All rights reserved. Certain mapping and direction data © 2005 NAVTEQ. All rights reserved. The Data for areas of Canada includes information taken with permission from Canadian authorities, including: © Her Majesty the Queen in Right of Canada, © Queen's Printer for Ontario. NAVTEQ and NAVTEQ ON BOARD are trademarks of NAVTEQ. © 2005 Tele Atlas North America, Inc. All rights reserved. Tele Atlas and Tele Atlas North America are trademarks of Tele Atlas, Inc. Kansas Casino Market Study & Gaming Revenue Projections

median household income ranged from 2.1% in Oklahoma, 3.0% in Texas, and to 3.1% in Kansas for the 2007 to 2012 period.

Primary Market The primary market for the southwest trade area is made up of the eight counties surrounding the proposed casino in Ford County. Exhibit 5-2 shows that the adult population for the primary market was approximately 61 thousand in 2007, which represented 18% of the total adult population in the subject trade area. This adult population segment has been forecasted to be approximately 62 thousand by 2012. As a group, the eight counties making up the primary market are projected to have an average compound growth rate of 0.5% between 2007 and 2012.

Exhibit 5-2 Adult Population for Counties Surrounding Ford County Casino

# of ACGR % Pop/ Co Counties County Names 2007 2012 07 to 12 2012 Clark KS 1,723 1,760 0.4% 1% Edwards KS 1,999 1,777 -2.3% 1% Ford KS 20,948 21,370 0.4% 6% Gray KS 4,413 4,904 2.1% 1% Hodgeman KS 1,589 1,709 1.5% 1% Kiowa KS 2,238 2,228 -0.1% 1% Meade KS 3,047 3,014 -0.2% 1% Finney KS 24,810 25,482 0.5% 7% 8 Total Surrounding Counties 60,767 62,244 0.5% 18% Total Kansas Counties - Excluding 43 Surrounding Counties 223,696 218,238 -0.5% 64% 7 Total Oklahoma Counties 50,021 52,359 0.9% 15% 2 Total Texas Counties 8,518 8,919 0.9% 3% 60 Total Trade Area Population 343,002 341,760 -0.1% 100%

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008.

May 2008 Wells Gaming Research Page 5-3 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Capacity & Competition Casino gaming capacity for the approximate 150-mile radius of the Ford County casino site is summarized in Exhibit 5-3. Currently, there is no gaming capacity within this area. The casino proposed for Ford County (scenario 1 below) would introduce 800 slots and 20 table games. Other amenities would include 100 hotel rooms.

Scenario 2 shows expansions that are planned at four northern Oklahoma casinos. These expansions are located beyond the 150-mile radius. They would not be close enough to add their capacity to the southwest trade area’s total. Nonetheless, the gaming facilities could compete with casinos located in the southwest trade area for casino players.

Exhibit 5-3 Capacity Statistics for the Southwest Trade Area

# of # of # of Casinos Slots Tables Rooms Parking Existing Capacity - Southwest Gaming Zone 0 0 0 0 Scenario 1 - Capacity for Ford County Casino (Planned) 800 20 100 1,700 Scenario 2 - Expansions in Northern Oklahoma 0 0 0 0 Scenario 3 - Other Proposed (11 Casinos including Sumner County) 2,000 50 275 3,700 Total Existing, Expansions, & New Casinos 2,800 70 375 5,400

Data Source: Wells Gaming Research, May 2008.

Eleven new casinos have been incorporated into scenario 3. However, gaming capacity shown in this schedule reflects only the new Sumner County casino with 2,000 slot machines and 50 table games. Assumed amenities include 275 hotel rooms and 3,700 parking spaces. The remaining new casinos are beyond the 150-mile radius, but are in the gravity model and compete to a limited extent for business within the southwest trade area.

The total casino capacities include 2,800 slot machines and 70 table games. Other amenities include 375 hotel rooms and 5,400 parking spaces.

May 2008 Wells Gaming Research Page 5-4 Kansas Casino Market Study & Gaming Revenue Projections

Gaming Revenues The forecasted gaming revenues that correspond with the foregoing scenarios are summarized in Exhibit 5-4. The dollar flows shows where the gaming revenue came from and where they went. The current status reflects a loss of $57 million that flowed out of Kansas into Oklahoma. Texas also lost $3 million to Oklahoma. Scenarios 1 through 3 illustrate the gaming revenue that has been forecasted for 2012 given the assumptions of each scenario.

Exhibit 5-4 Summary of the 2012 Flow of Gaming Revenues (Dollars in Millions)

Current Status 2007 Scenario-1 2012 Scenario-2 2012 Scenario-3 2012 Coming Going Coming Going Coming Going Coming Going State From To Dif From To Dif From To Dif From To Dif KS $57 $0 -$57 $102 $44 -$58 $102 $43 -$60 $106 $51 -$55 OK $18 $78 $60 $22 $83 $61 $22 $84 $63 $22 $80 $58 TX $3 $0 -$3 $3 $0 -$3 $3 $0 -$3 $3 $0 -$3 Total $78 $78 $0 $127 $127 $0 $127 $127 $0 $130 $130 $0

Data Source: Wells Gaming Research, May 2008.

The key assumption of scenario 1 is the addition of the new generic casino in Ford County, which serves to increase the gaming revenues for Kansas from the current level of $57 million to $102 million. Given the competition, Kansas is only able to retain $44 million. The revenues flowing into Oklahoma increase to $83 million.

Scenario 2 includes the new casino in Ford County and the expansions at Oklahoma casinos. The revenue data shows that Kansas continues to generate $102 million, but only retains $43 million for a net loss of $59 million. Oklahoma continues to generate $22 million, but receives $84 million for a net gain of $62 million. Thus, Oklahoma enjoys $60 million flowing out from Kansas plus another $3 million flowing from Texas. The bottom line totals for scenarios 1 and 2 are the same, suggesting that the casino expansions in Oklahoma had very little impact on bottom line gaming revenues.

The casino is Sumner County, as well as other new casinos in Oklahoma, are added to the mix in scenario 3. Overall, gaming revenues increase by $3 million, from $127 million to $130 million. Total gaming revenues generated in Kansas increase to $106 million, up by $4 million. Revenues going to Kansas increased by $8 million, from $43 to $51, thereby cutting the loss from $60 million to $55 million.

May 2008 Wells Gaming Research Page 5-5 Kansas Casino Market Study & Gaming Revenue Projections

Detailed Analyses for the Trade Area For the Southwest Gaming Zone

Population Statistics For background reference, WGR compiled both total and adult population statistics for the 100-mile trade area surrounding Ford County. However, due to the age restrictions on casino gaming, only the adult population statistics were used to forecast gross gaming revenues.

The total population for the southwest trade area was 504,936 in 2007. Included were 420,547 in Kansas, 71,610 in Oklahoma, and 12,779 in Texas.

The corresponding adult population totaled 343,002 (68% of the total) in 2007. The adult population has been projected to decline to 341,760 by 2012, reflecting a negative annual growth rate of .04%.

Exhibit 5-5 Total & Adult Population Statistics

2000 Total & Adult 2007 Total & Adult 2012 Total & Adult Adult Adult Adult Adult % of Adult % of Adult % of # of % of Adult % of Adult % of Adult ST CO Total Adult Total Total Total Adult Total Total Total Adult Total Total KS 51 435,574 295,274 67.8% 84.2% 420,547 284,463 67.6% 82.9% 415,219 280,482 67.6% 82.1% OK 7 67,281 47,201 70.2% 13.5% 71,610 50,021 69.9% 14.6% 75,178 52,359 69.6% 15.3% TX 2 12,063 8,045 66.7% 2.3% 12,779 8,518 66.7% 2.5% 13,385 8,919 66.6% 2.6% TOT 60 514,918 350,520 68.1% 100.0% 504,936 343,002 67.9% 100.0% 503,782 341,760 67.8% 100.0%

Data Source: Wells Gaming Research, May 2008.

In 2007, the total population of the eight counties surrounding Ford County was 96,059. The 2012 projections increased to 98,219, reflecting an annual growth rate of 0.5%.

Exhibit 5-6 Total Population Statistics for 2000 and 2006-2012

# of ACGR % Pop/ CO Counties/Parishes 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 Co 2012 Clark KS 2,390 2,430 2,441 2,451 2,462 2,472 2,483 2,493 0.5% 3% Edwards KS 3,449 2,860 2,793 2,728 2,664 2,602 2,542 2,482 -2.8% 3% Ford KS 32,458 32,666 32,797 32,928 33,059 33,191 33,322 33,456 0.5% 34% Gray KS 5,904 6,669 6,810 6,956 7,104 7,255 7,410 7,567 2.6% 8% Hodgeman KS 2,085 2,289 2,323 2,357 2,392 2,427 2,463 2,499 1.8% 3% Kiowa KS 3,278 3,128 3,125 3,123 3,120 3,117 3,114 3,111 -0.1% 3% Meade KS 4,631 4,536 4,526 4,516 4,505 4,496 4,486 4,476 -0.3% 5% Finney KS 40,523 41,024 41,244 41,464 41,687 41,911 42,135 42,135 0.5% 43% 8 Total Surrounding Counties 94,718 95,602 96,059 96,523 96,993 97,471 97,955 98,219 0.5% 100% Total Kansas Counties - Excluding Surrounding 43 Counties 340,856 326,077 324,488 322,917 321,356 319,810 318,279 317,000 -0.6% 7 Total Oklahoma Counties 67,281 70,946 71,610 72,293 72,987 73,701 74,431 75,178 1.2% 2 Total Texas Counties 12,063 12,664 12,779 12,896 13,014 13,132 13,257 13,385 1.1% 60 Total Trade Area Population 514,918 505,289 504,936 504,629 504,350 504,114 503,922 503,782 -0.1%

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-6 Kansas Casino Market Study & Gaming Revenue Projections

In 2007, the adult population in the eight surrounding counties was 60,767. The adult population has been projected to grow at an average compound growth rate of 0.6% per year to 62,244 by 2012.

Exhibit 5-7 Adult Population Statistics for 2000 and 2006-2012

# of ACGR % Pop/ CO Counties 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 Co 2012 Clark KS 1,687 1,715 1,723 1,730 1,738 1,745 1,753 1,760 0.5% 3% Edwards KS 2,469 2,047 1,999 1,953 1,907 1,863 1,820 1,777 -2.8% 3% Ford KS 20,731 20,864 20,948 21,031 21,114 21,199 21,283 21,370 0.5% 34% Gray KS 3,826 4,322 4,413 4,508 4,604 4,702 4,802 4,904 2.6% 8% Hodgeman KS 1,426 1,566 1,589 1,612 1,636 1,660 1,685 1,709 1.8% 3% Kiowa KS 2,348 2,241 2,238 2,237 2,235 2,233 2,231 2,228 -0.1% 4% Meade KS 3,118 3,054 3,047 3,040 3,033 3,027 3,021 3,014 -0.3% 5% Finney KS 24,507 24,679 24,810 24,944 25,077 25,211 25,346 25,482 0.6% 41% 8 Total Surrounding Counties 60,112 60,488 60,767 61,055 61,344 61,640 61,941 62,244 0.6% 100% Total Kansas Counties - Excluding Surrounding 43 Counties 235,162 224,812 223,696 222,580 221,482 220,381 219,296 218,238 -0.6% 7 Total Oklahoma Counties 47,201 49,582 50,021 50,469 50,920 51,391 51,870 52,359 1.1% 2 Total Texas Counties 8,045 8,442 8,518 8,595 8,673 8,751 8,834 8,919 1.1% 60 Total Trade Area Population 350,520 343,324 343,002 342,699 342,419 342,163 341,941 341,760 -0.1%

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008

Average Median Household Income The average median household income (AMHI) statistics in 2007 for counties located within the three states in the southwest trade area were approximately $44,000 (Kansas), $38,000 (Oklahoma), and $45,000 (Texas). Based on the stated average compound growth rates for 2012, the median household incomes have been forecasted at approximately $51,000, $42,000, and $52,000, respectively for the three states.

Exhibit 5-8 Average Median Household Income Statistics for 2000 and 2006-2012

ACGR # of CO State 2000 2006 2007 2008 2009 2010 2011 2012 07 to 12 51 KS $35,628 $42,537 $43,822 $45,151 $46,524 $47,944 $49,412 $50,930 3.7% 7 OK $33,023 $37,413 $38,196 $38,995 $39,811 $40,643 $41,492 $42,358 2.5% 2 TX $36,765 $43,675 $44,958 $46,281 $47,646 $49,055 $50,505 $52,000 3.6%

Data Sources: Bureau of Business & Economic Research, UNR & Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-7 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo Casino Revenues & Visitors for the Southwest Zone’s Trade Area

Status Quo Casino Revenues The status quo (2007) gaming revenues totaled approximately $78.7 million for the southwest trade area. Casino players from Kansas who visit Oklahoma Tribal casinos located near the southern Kansas border generated over $58 million of this revenue. Without any casino expansions or additions in the southwest trade area, gaming revenues would most likely decline slightly to $77.97 million by 2012.

Exhibit 5-9 Status Quo Gaming Revenues (2007-2012) for the Southwest Trade Area

Revenue 2007 2008 2009 2010 2011 2012 All Existing Casinos $78,668,000 $78,512,000 $78,363,000 $78,224,000 $78,093,000 $77,966,000

Total $78,668,000 $78,512,000 $78,363,000 $78,224,000 $78,093,000 $77,966,000

Data Source: Wells Gaming Research, May 2008

Status Quo Visitors The status quo casino visitors totaled approximately 912 thousand. Absent casino expansions or additions, visitor counts could also be expected to decrease to approximately 902 thousand by 2012.

Exhibit 5-10 Status Quo Visitors for the Southwest Trade Area

Visitors 2007 2008 2009 2010 2011 2012

All Existing Casinos 911,608 909,430 907,306 905,290 903,368 901,512

Total 911,608 909,430 907,306 905,290 903,368 901,512

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-8 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo Estimates of Casino Revenue Flows The status quo for casino revenue shows what could be expected if no new casino development occurred in the southwest trade area. Focusing on 2007, the southwest trade area generated an estimated $79 million in total gaming revenues. Of the total, an estimated $58 million was generated by Kansas residents. Another $18 million came from Oklahoma, and approximately $3 million flowed in from Texas. However, the total amount ($78.7 million) flowed back to Oklahoma.

Exhibit 5-11 Status Quo Casino Revenue Flows (2007-2012) for the Southwest Trade Area

Current Scenario Revenues Coming From State 2007 2008 2009 2010 2011 2012 KS Total $58,101,210 $57,818,892 $57,540,952 $57,267,051 $56,998,266 $56,733,601 OK Total $17,727,675 $17,830,255 $17,932,721 $18,040,946 $18,149,847 $18,261,236 TX Total $2,840,656 $2,865,391 $2,891,123 $2,916,051 $2,943,580 $2,971,027 Total $78,669,541 $78,514,538 $78,364,796 $78,224,048 $78,091,693 $77,965,864 Current Scenario Revenues Going To State 2007 2008 2009 2010 2011 2012 OK Total $78,668,000 $78,512,000 $78,363,000 $78,224,000 $78,093,000 $77,966,000 Total $78,668,000 $78,512,000 $78,363,000 $78,224,000 $78,093,000 $77,966,000

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-9 Kansas Casino Market Study & Gaming Revenue Projections

Status Quo Southwest Trade Area Capacity The following list of gaming capacity illustrates that there are currently no casinos (gaming capacity) operating within approximately 150 miles of the casino site in the southwest zone.

Exhibit 5-12 Current Casino Capacity Statistics

# of # of # of # of Con- # of Enter # of Pit Poker Total Bingo Race Casino vention # of Restau- tain Park- Casinos Slots Tables Tables Tables Seats Book S.F. S.F. Rooms rants ment ing Current Capacity for Existing Casinos Current Capacity for Existing Casinos Existing Casinos 000000000000 Scenario 1 - Ford County Proposed Scenario 1 - Ford County Proposed Ford County Planned 800 20 0 20 0 0 10,000 100 3 3 1,700 Subtotal Of Scenario 1 800 20 0 20 0 0 0 10,000 100 3 3 1,700 Scenario 2 - Expansions Subtotal of Scenario 2 000000000000 Scenario 3 - Other Proposed Sumner County Planned 2,000 50 0 50 0 0 30,000 275 4 3 3,700 Subtotal of Scenario 3 2,000 50 0 50 0 0 0 30,000 275 4 3 3,700 Total Expansions & New Casinos 2,800 70 0 70 0 0 0 40,000 375 7 6 5,400 Total Existing, Expansions & New 2,800 70 0 70 0 0 0 40,000 375 7 6 5,400

Data Source: Wells Gaming Research, May 2008

Future Capacity with Casino Growth Casino capacity is being proposed for the future. Scenario 1, above, includes the new casino to be located in Ford County, which will be equipped with 800 slot machines and 20 table games. Other amenities will include 10,000 square feet of convention/meeting space, 100 hotel rooms, three restaurants, and three entertainment venues, and 1,700 parking spaces.

Even though scenario 2 includes expansions at four casinos located in northern Oklahoma, the subject casinos are located beyond the 150-radius and are not included in this schedule. Thus, scenario 2 has been acknowledged above, but does not add any new capacity to the southwest trade area.

Scenario 3 includes the gaming capacity projected for a casino in Sumner County, which will be equipped with 2,000 slot machines and 50 gaming tables. Other amenities include 30,000 square feet of convention/meeting space, 275 hotel rooms, four restaurants, and three entertainment venues, and 3,700 parking spaces.

Combined, scenarios 1 through 3 would add 2,800 slot machines and 70 table games. Other proposed amenities include 40,000 square feet of convention/meeting square footage, 375 hotel rooms, seven restaurants, six entertainment venues, and 5,400 parking spaces.

May 2008 Wells Gaming Research Page 5-10 Kansas Casino Market Study & Gaming Revenue Projections

Scenario Analyses for the Southwest Trade Area

Scenario 1

Assumptions Scenario 1 includes the addition of a casino located at the western edge of Dodge City in Ford County, Kansas. The mid case projections are for a casino equipped with 800 slot machines and 20 table games. Other proposed amenities include 10,000 square feet of convention/meeting space, three restaurants, 100 hotel rooms, three entertainment venues (two small and one large), and 1,700 parking spaces.

Revenue Projections The following gaming revenue projections include WGR’s 2010 and 2012 low, mid, and high case forecasts for scenario 1. The mid case projections show casino gaming revenues of $127 million in 2010 and 2012. An estimated $44 million would come from the casino in Ford County and $83 million would come from all existing casinos.

Exhibit 5-13 Revenue Forecasts for Scenario 1

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Ford County (Proposed) $0 $32,263,000 $32,464,000 $44,022,000 $44,239,000 $52,167,000 $52,385,000 All Existing Casinos $78,668,000 $94,991,000 $94,719,000 $83,233,000 $82,950,000 $75,088,000 $74,800,000 Total Scenario 1 $78,668,000 $127,254,000 $127,183,000 $127,255,000 $127,189,000 $127,255,000 $127,185,000

Data Source: Wells Gaming Research, May 2008

Revenue Impacts Currently, there is no gaming activity in the southwest trade area of Kansas. The revenue impacts for the mid case include a total of $49 million. Minor increases have been projected for the 2012 gaming revenues.

Exhibit 5-14 Revenue Impacts for Scenario 1

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Ford County (Proposed) $0 $32,263,000 $32,464,000 $44,022,000 $44,239,000 $52,167,000 $52,385,000 All Existing Casinos $0 $16,767,000 $16,753,000 $5,009,000 $4,984,000 -$3,136,000 -$3,166,000 Total Scenario 1 $0 $49,030,000 $49,217,000 $49,031,000 $49,223,000 $49,031,000 $49,219,000

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-11 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow of Funds Scenario 1 shows that in 2007 the southwest trade area generated $79 million in total gaming revenues (refer to the first section of Exhibit 5-15 captioned Scenario 1 Revenues Coming From). Of the total, an estimated $58 million (74%), was generated by casino players in Kansas. As shown in the scenario 1 mid case for 2007, none of the $58 million stayed in Kansas. Rather, it all went to Tribal casinos in Oklahoma (refer to the third section of Exhibit 5-15 captioned Scenario 1 Mid Case - Revenues Going To).

Kansas has been projected to generated $103 million in 2010; however, the 2010 mid case shows that Kansas would only retain $44 million, a net loss of $59 million. An estimated $83 million would flow back to Oklahoma (the $24 million coming from Oklahoma and Texas plus the $59 million coming from Kansas). Assuming no additional competition enters the market, this trend could be expected to continue through 2012.

Exhibit 5-15 Flows of Gaming Revenue Funds for Scenario 1 Illustrates Where the Gaming Revenues Originated & Where They Went

Scenario 1 - Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $58,101,210 74% $57,818,892 $57,540,952 $102,869,150 81% $102,624,581 $102,388,917 81% OK $17,727,675 23% $17,830,255 $17,932,721 $21,208,264 17% $21,382,157 $21,559,736 17% TX $2,840,656 4% $2,865,391 $2,891,123 $3,176,700 2% $3,206,939 $3,237,134 3% Total $78,669,541 100% $78,514,538 $78,364,796 $127,254,114 100% $127,213,677 $127,185,787 100%

Scenario 1 Low Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $0 $32,263,000 25% $32,362,000 $32,464,000 26% OK $78,668,000 100% $78,512,000 $78,363,000 $94,991,000 75% $94,851,000 $94,719,000 74% Total $78,668,000 100% $78,512,000 $78,363,000 $127,254,000 100% $127,213,000 $127,183,000 100%

Scenario 1 Mid Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $0 $44,022,000 35% $44,129,000 $44,239,000 35% OK $78,668,000 100% $78,512,000 $78,363,000 $83,233,000 65% $83,085,000 $82,950,000 65% Total $78,668,000 100% $78,512,000 $78,363,000 $127,255,000 100% $127,214,000 $127,189,000 100%

Scenario 1 High Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $0 $52,167,000 41% $52,273,000 $52,385,000 41% OK $78,668,000 100% $78,512,000 $78,363,000 $75,088,000 59% $74,939,000 $74,800,000 59% Total $78,668,000 100% $78,512,000 $78,363,000 $127,255,000 100% $127,212,000 $127,185,000 100%

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-12 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 2

Assumptions Scenario 2 incorporates the casino in Ford County included in scenario 1, as well as the following proposed expansions at Oklahoma casinos:

Oklahoma 1. Cherokee Casino Resort in Catoosa, OK (January 2009) 2. Kickapoo Casino in McLoud, OK (January 2009) 3. Osage Million Dollar Elm in Ponca City, OK (January 2009) 4. Creek Nation Casino in Tulsa, OK (September 2008

Revenue Projections The following casino gaming revenue projections include WGR’s low, mid, and high case forecasts for 2010 and 2012. The mid case projections show total casino gaming revenues of approximately $127 million for the 2010 to 2012 period, almost identical to that of scenario 1. The added competition of the Oklahoma expansions simply shifts the distribution between the two revenue categories.

Exhibit 5-16 Gaming Revenues Projections for Scenario 2 Includes Scenario 1 Plus the Proposed Expansions

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Ford County (Proposed) $0 $31,126,000 $31,325,000 $42,551,000 $42,767,000 $50,540,000 $50,759,000 All Existing Casinos $78,668,000 $96,128,000 $95,860,000 $84,702,000 $84,419,000 $76,714,000 $76,430,000 Total Scenario 1 $78,668,000 $127,254,000 $127,185,000 $127,253,000 $127,186,000 $127,254,000 $127,189,000

Data Source: Wells Gaming Research, May 2008

Revenue Impacts The gaming revenue impacts show that the addition of the Oklahoma expansions results in a negative difference of $ 2,000 between scenarios 1 and 2.

Exhibit 5-17 Revenue Impacts of Scenario 2

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Ford County (Proposed) $0 -$1,137,000 -$1,139,000 -$1,471,000 -$1,472,000 -$1,627,000 -$1,626,000 All Existing Casinos $0 $1,137,000 $1,141,000 $1,469,000 $1,469,000 $1,626,000 $1,630,000 Total Scenario 1 $0 $0 $2,000 -$2,000 -$3,000 -$1,000 $4,000

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-13 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow of Funds The addition of the casino in Ford County, together with the expansions at Oklahoma Tribal casinos, would trigger changes in the following revenue flows. Kansas has been forecasted to generate approximately $103 million in 2010 (refer to the first section of Exhibit 5-18 captioned Scenario 2 Revenues Coming From). However, in the 2010 mid case, Kansas has been projected to retain $43 million (a net loss of $60.5 million). Refer to the third section of Exhibit 5-18 captioned Scenario 2 Mid Case - Revenues Going To. Absent additional competition, the foregoing revenue flows would most likely remain constant through 2012.

Exhibit 5-18 Flows of Gaming Revenue Funds for Scenario 2 Illustrates Where the Gaming Revenues Originated & When They Went

Scenario 2 - Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $58,101,210 74% $57,818,892 $57,540,952 $102,869,150 81% $102,624,581 $102,388,917 81% OK $17,727,675 23% $17,830,255 $17,932,721 $21,208,264 17% $21,382,157 $21,559,736 17% TX $2,840,656 4% $2,865,391 $2,891,123 $3,176,700 2% $3,206,939 $3,237,134 3% Total $78,669,541 100% $78,514,538 $78,364,796 $127,254,114 100% $127,213,677 $127,185,787 100%

Scenario 2 Low Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $0 $31,126,000 24% $31,224,000 $31,325,000 25% OK $78,668,000 100% $78,517,000 $78,362,000 $96,128,000 76% $95,988,000 $95,860,000 75% Total $78,668,000 100% $78,517,000 $78,362,000 $127,254,000 100% $127,212,000 $127,185,000 100%

Scenario 2 Mid Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $0 $42,551,000 33% $42,657,000 $42,767,000 34% OK $78,668,000 100% $78,517,000 $78,362,000 $84,702,000 67% $84,556,000 $84,419,000 66% Total $78,668,000 100% $78,517,000 $78,362,000 $127,253,000 100% $127,213,000 $127,186,000 100%

Scenario 3 High Case - Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $0 $50,540,000 40% $50,647,000 $50,759,000 40%

OK $78,668,000 100% $78,517,000 $78,362,000 $76,714,000 60% $76,568,000 $76,430,000 60% Total $78,668,000 100% $78,517,000 $78,362,000 $127,254,000 100% $127,215,000 $127,189,000 100%

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-14 Kansas Casino Market Study & Gaming Revenue Projections

Scenario 3 Assumptions Scenario 3 includes the assumptions in scenarios 1 and 2, as well as the following casinos that are proposed for the southwest trade area:

Kansas 1. Camptown Greyhound Park in Frontenac, KS (January 2009) 2. Sumner County planned in Wellington, KS (January 2010) 3. Cherokee County planned in Baxter Springs, KS (January 2010)

Oklahoma 1. Downstream Casino Resort in Ottawa, OK (Jul 2008) 2. First Council Casino in Newkirk, OK (Mar 2008) 3. Ioway Casino Resort in Lincoln, OK (Jan 2009) 4. Pawnee Nation planned in Chilocco, OK 5. Ponca Tribe Oklahoma planned in Ponca City, OK 6. Seneca-Cayuga Tribes of Oklahoma planned in Grove, OK (Jul 2008) 7. Shawnee Tribe Oklahoma planned in Oklahoma City, OK 8. Wichita & Affiliated Tribes planned in Hinton, OK

Revenue Projections Following in Exhibit 5-19 are WGR’s low, mid, and high case casino revenue forecasts for scenario 3, 2010 and 2012. The mid case projections show gaming revenues of more than $130 million for 2010 and 2012. The estimated revenue allocations project a reduction going to Ford County, approximately $34 million (down from the $42 to $44 million range projected in scenarios 2 and 1, respectively). Other revenue allocations include $41.5 million allocated to other proposed casinos, and $55 million allocated to all existing casinos.

Exhibit 5-19 Revenues Forecasts for Scenario 3

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Ford County (Proposed) $0 $24,801,000 $24,985,000 $33,969,000 $34,181,000 $40,733,000 $40,957,000 Other Proposed Casinos $0 $45,112,000 $44,903,000 $41,477,000 $41,261,000 $38,779,000 $38,561,000 All Existing Casinos $78,668,000 $60,531,000 $60,432,000 $54,998,000 $54,877,900 $50,933,300 $50,804,100 Total Scenario 3 $78,668,000 $130,444,000 $130,320,000 $130,444,000 $130,319,900 $130,445,300 $130,322,100

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-15 Kansas Casino Market Study & Gaming Revenue Projections

Revenue Impacts Following are the combined gaming revenue impacts of scenarios 1 and 2, together with the expansions proposed in scenario 3. These include the three casinos in Kansas and the eight casinos in Oklahoma. Overall, the changes in gaming revenue would be limited to an increase of approximately $3.2 million over the totals for scenarios 1 and 2.

Exhibit 5-20 Revenue Impacts for Scenario 3 Includes Scenario 1, the OK Expansions, & Three KS Casinos

Current Low Case Mid Case High Case 2007 2010 2012 2010 2012 2010 2012 *Ford County (Proposed) $0 -$6,325,000 -$6,340,000 -$8,582,000 -$8,586,000 -$9,807,000 -$9,802,000 *Other Proposed Casinos $0 $45,112,000 $44,903,000 $41,477,000 $41,261,000 $38,779,000 $38,561,000 All Existing Casinos $0 -$35,597,000 -$35,428,000 -$29,704,000 -$29,541,100 -$25,780,700 -$25,625,900 Total Scenario 3 $0 $3,190,000 $3,135,000 $3,191,000 $3,133,900 $3,191,300 $3,133,100

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-16 Kansas Casino Market Study & Gaming Revenue Projections

Forecasted Flow of Funds WGR’s projections for shifts in casino revenue flows, given the assumptions of scenario 3, are summarized in Exhibit 5-21. Projections for Kansas include $106 million 2010 (refer to the first section of Exhibit 5-21 captioned Scenario 3 Revenues Coming From). In the 2010 mid case estimates, less than one-half ($51 million) would go to Kansas. The net loss to Kansas has been estimated at $55 million (refer to the third section of Exhibit 5-21 captioned Scenario 3 Mid Case - Revenues Going To). Oklahoma and Texas combined are projected to generate $24.3 million in 2010. However, nearly $80 million would flow back to Oklahoma in the mid case. Without additional changes in the southwest trade area’s gaming market, the 2010 forecasts could be expected to remain constant through 2012.

Exhibit 5-21 Flows of Gaming Revenue Funds for Scenario 3 Illustrates Where the Gaming Revenue Originated & Where They Went

Scenario 3 - Revenues Coming From State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $58,101,210 74% $57,917,795 $57,639,207 $106,059,235 81% $105,785,654 $105,521,431 81%

OK $17,727,675 23% $17,832,355 $17,934,814 $21,210,349 16% $21,384,236 $21,561,807 17% TX $2,840,656 4% $2,865,391 $2,891,123 $3,176,700 2% $3,206,939 $3,237,134 2% Total $78,669,541 100% $78,615,541 $78,465,144 $130,446,284 100% $130,376,829 $130,320,372 100% Scenario 3 - Low Case Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $645,000 $42,730,000 33% $42,751,000 $42,774,000 33% OK $78,668,000 100% $78,617,000 $77,820,000 $87,714,000 67% $87,628,000 $87,546,000 67% Total $78,668,000 100% $78,617,000 $78,465,000 $130,444,000 100% $130,379,000 $130,320,000 100% Scenario 3 - Mid Case Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $645,000 $50,634,000 39% $50,668,000 $50,706,000 39% OK $78,668,000 100% $78,617,000 $77,820,000 $79,810,000 61% $79,712,000 $79,613,900 61% Total $78,668,000 100% $78,617,000 $78,465,000 $130,444,000 100% $130,380,000 $130,319,900 100% Scenario 3 - High Case Revenues Going To State 2007 % 2007 2008 2009 2010 % 2010 2011 2012 % 2012 KS $0 0% $0 $645,000 $56,446,000 43% $56,485,000 $56,531,000 43%

OK $78,668,000 100% $78,617,000 $77,820,000 $73,999,300 57% $73,888,300 $73,791,100 57% Total $78,668,000 100% $78,617,000 $78,465,000 $130,445,300 100% $130,373,300 $130,322,100 100%

Data Source: Wells Gaming Research, May 2008

May 2008 Wells Gaming Research Page 5-17 Kansas Casino Market Study & Gaming Revenue Projections

Section 6

Wells Gaming Research May 2008 Kansas Casino Market Study & Gaming Revenue Projections

Information on Wells Gaming Research & Richard H. Wells

Following is detailed information regarding Wells Gaming Research’s many services, as well as personal information about Richard H. Wells, WGR’s president:

• Professional Services Offered (page 6-2)

• Casino Feasibility Studies (page 6-3)

• Casino Gaming Market Studies (page 6-3)

• Competitive Gaming Equipment Inventories (page 6-4)

• Litigation & Legislative Support (page 6-4)

• Marketing Research (page 6-4)

• Marketing Surveys (page 6-5)

• Market & Financial Due Diligence (page 6-5)

• Financial Benchmark Studies (page 6-5)

• Special Projects (page 6-5)

• Other Casino Gaming Services (page 6-6)

• Corporate Background (page 6-6)

• Online Casino Player Count Service™ (page 6-7)

• Richard H. Wells, Experience and Qualifications (page 6-8)

• Client List, including current and previous WGR clients (page 6-9)

May 2008 Wells Gaming Research Page 6-1 Kansas Casino Market Study & Gaming Revenue Projections

Professional Services Offered:

Wells Gaming Research (hereinafter referred to as WGR) is a highly respected provider of a wide-range of research and advisory services for the casino gaming industry.

Casino Player Count Service™: WGR's Casino Player Count Service™ has become the standard for measuring relative player count performance within the casino gaming industry. Our player count service is widely used by casinos, as well as by equity analysts who track public gaming companies. WGR’s weekly online player count reports are accompanied by a host of powerful, user friendly analytical tools that make it quick and easy for a client casino to monitor the competition. Client casinos can log on to WGR’s website and evaluate their competitors using the following performance criteria:

• Casino rankings based on player count volume • Number of table game and/or slot machine players • Percent distribution of players • Gaming capacity inventory for both table games and slot machines • Percent distribution of market capacity • Percent of capacity utilized • User defined market fair share percentages

Fair Share Goal Setting Targets for User Defined Markets One of the newest and most exciting features of WGR’s Casino Player Count Service™ is fair share goal setting for user-defined markets. WGR’s online player count service automatically calculates the number of players required for a casino to reach a series of fair market share targets (for example, 100%, 105%, and 110%).

Gaming Capacity Inventories WGR updates the gaming capacity inventory statistics for the player count service on a quarterly basis. Client casinos can easily monitor capacity adjustments for both table games and slot machines for their casino, as well as for their competitors. WGR’s website also provides a capacity trend analysis feature.

Equity Analysts Equity analysts use WGR’s Casino Player Count Service™ reports to monitor player counts for individual casinos owned by public companies, and to track entire market areas. WGR’s player count statistics are also given consideration by equity analysts when forecasting quarterly casino revenues.

Data Collection for WGR’s Casino Player Count Service WGR’s field representatives physically count casino players five or more times per week in 164 casinos located throughout the U.S. WGR’s current player count service areas include California, Louisiana, Mississippi, Nevada, and New Mexico.

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Casino Feasibility Studies

WGR’s databases contain a detailed history of casino player counts collected in eleven major gaming markets located throughout the U.S. This exclusive player count information provides WGR with a proprietary resource that is unmatched for projecting player volume, which is a key variable in the revenue function.

WGR has conducted casino feasibility studies and financial projections for a number of new casinos, including those proposed in:

• Mississippi – Tunica. • Nevada - Las Vegas (the Strip, the Offstrip, and North Las Vegas), as well as for Reno, Henderson, and Jackpot. • Nova Scotia - Halifax and Sydney.

Casino Gaming Market Studies

WGR’s databases contain over 350,000 casino player counts collected between 1990 and 2007. Capacity information is collected and updated regularly on each casino’s inventory capacity mix of slot machines and table games. The player count data allows WGR to track individual casinos, groups of casinos, and casino markets more closely and accurately than any other organization except the state gaming regulatory authorities.

WGR has developed a custom casino gravity modeling system designed to forecast casino revenues while taking into account the impacts that new or expanded competing casinos could have on the project. The model is customized to include the appropriate trade area and competitive casinos for each project.

Major market studies include:

• Las Vegas, Nevada area (Strip, Offstrip, North Las Vegas, & Henderson) • Reno & Sparks, Nevada • Minden/Gardnerville, Nevada • Carson City, Nevada • Northern California • South Lake Tahoe • Mississippi (Tunica, Natchez, & Vicksburg) • Shreveport, Louisiana • Iowa (Spencer, Ottumwa, Emmetsburg, Waterloo, Davenport, & Bettendorf) • Sugar Creek, Missouri • Southern Kansas • Southern Indiana • North-East Kentucky

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Competitive Gaming Equipment Inventories

WGR conducts capacity inventories of slot machines, electronic player tracking systems, and other gaming equipment located in casinos throughout the U.S. The client selects the casinos to be inventoried. Then, WGR conducts the equipment inventories and does the comparative analyses. WGR's clients include both casinos and major slot machine manufacturers. Slot machine inventory projects include:

• 38 Tribal casinos in California. • 108,000 slot machines located in 50 U.S. casinos, as well as five Canadian casinos (inventories are conducted twice each year). • 18,000 slot machines located in eight large Las Vegas casinos.

Litigation & Legislative Support

WGR provides a host of gaming related services to attorneys in the form of:

• Financial and market analyses • Expert testimony and depositions • Analyses of opposing expert reports • Development of questions for depositions • Development of exhibits for use in court • Competitive analyses for anti-trust issues • Exhibits, documents, and expert testimony for legislative issues

Marketing Research

WGR has conducted a wide variety of gaming related marketing research studies for casino clients, as well as for proprietary internal use. For example, WGR has analyzed:

• The demographics and gambling characteristics of golfers on a nationwide basis.

• The gambling and demographic characteristics of local residents in both Reno and Las Vegas.

• The growth of various forms of gaming in Reno's four major feeder markets (California, Oregon, Washington, and British Columbia).

May 2008 Wells Gaming Research Page 6-4 Kansas Casino Market Study & Gaming Revenue Projections

Marketing Surveys

Recent market research surveys include:

• 600 Las Vegas Strip visitors for a casino client • 465 slot directors for a slot manufacturer • 900 gaming establishments for a slot manufacturer • 600 telephone inquiries to casino slot departments regarding online slot machine systems

Market & Financial Due Diligence

WGR is well positioned to assist casino buyers in evaluating gaming markets in terms of:

• Competition • Financial and operating performance • Improvement potential of casino acquisition candidates

Financial Benchmark Studies

WGR conducts financial benchmark studies for existing casinos. Both revenue and expense line items are compared with a casino's peer group of competitors. Differences are flagged. One such study greatly aided the Client in improving its financial performance and in turning losses into profits.

Special Projects

WGR conducts special projects on an ongoing basis. Some examples include:

• Casino market supply and demand analyses • Slot and table game trends • Casino player trend analyses • Utilization analyses (table games including Caribbean Stud and Let-It-Ride, as well as slot machines and automatic shuffler) • Competitive analyses of slot machine inventories and utilization • Table game instruction programs • Average bets by table minimums for blackjack and craps • Player counts by ethnic groups

May 2008 Wells Gaming Research Page 6-5 Kansas Casino Market Study & Gaming Revenue Projections

Other Casino Gaming Services

Slot Payback Certification WGR provides verification and certification of win percentages for slot machines and video poker machines. Casinos have successfully used the win percentages in advertising campaigns.

Pedestrian Traffic Counts WGR has conducted pedestrian traffic studies to determine pedestrian volumes, directions, and other characteristics of pedestrian traffic behavior in targeted areas in Las Vegas and Reno. Two specific locations were the intersection of Las Vegas Boulevard and Tropicana Avenue in Las Vegas and on Virginia Street in downtown Reno.

Special Event Attendance WGR conducts attendance counts at special events, primarily in Nevada (Reno, Las Vegas, and Laughlin) for convention authorities and other clients. WGR has conducted attendance counts at most of Reno’s special events.

Corporate Background

WGR was established in 1990. In 1995, WGR was incorporated under the laws of the State of Nevada.

WGR is a privately held corporation. The principal officers include Richard H. Wells, President and Peggy P. Wells, Vice President and Secretary/Treasurer.

WGR’s president, Richard H. Wells, has over thirty years of experience in conducting financial and market feasibility studies for the casino, hotel, banking, and oil and gas industries. Wells is supported by a well-trained staff with experience and expertise in computer programming, finance, economics, and market analyses.

In addition to the staff, WGR subcontracts, on an as-needed basis, with highly qualified and respected professionals who specialize in a wide-range of technical disciplines including marketing research, statistics, demographic statistics and data analyses, economic and social impact analyses, and legal counsel.

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Online Casino Player Count Service™

WGR has converted its player count reporting system from a weekly hard copy report to a suite of powerful, online, easy-to-use reporting and analysis tools. The Internet now makes it possible for WGR to share these tools with our clients.

WGR is not only providing its Casino Player Count Service™ Reports online via the Internet, we are also providing our clients with a host of online analytical tools. For example, WGR’s clients can now select a specific set of competitive casinos and time periods to conduct custom analyses.

A total of seven (7) online reporting menu options are offered:

1. Monthly 2. Weekly 3. Daily 4. Multi-Month Trend Analysis 5. User Defined Two-Period Comparisons 6. Capacity Trend Analysis 7. Average Counts by Day-of-Week or Time-of-Day

Four (4) options are provided for viewing, downloading, and printing the user defined reports:

1. Web Browser, 2. Tab Delimited Download (Excel or other spreadsheet compatible) 3. PDF file uncompressed 4. PDF file compressed (ZIP)

Weekend player counts are now available to our clients by Monday afternoon, 5PM Pacific Time. All weekly player count data is audited and finalized by Thursday afternoon, 5PM Pacific Time. This puts the player count data in the clients’ hands several days earlier than the hard copy reports.

Online Access & Client Training: Each person in our Client's organization who needs access to WGR online service will be assigned a username and password for secure website access. WGR's clients are allowed an unlimited number of users, at no additional cost.

WGR will conduct a training session to acquaint Client users with the new online system. WGR's new online reporting system is easy-to-use and quick at creating user defined custom player count reports. A half-hour training/orientation session is all that is needed for a user to get started with WGR's new online reporting system.

May 2008 Wells Gaming Research Page 6-7 Kansas Casino Market Study & Gaming Revenue Projections

Richard H. Wells, Experience & Qualifications

Wells is founder and president of Wells Gaming Research, a Nevada Corporation that provides Casino Player Count Service™, a market share tracking service, to over 160 casino clients in Nevada, Mississippi, Louisiana, New Mexico, and California.

Wells Gaming Research also performs a wide range of consulting and gaming research assignments including casino market studies, financial feasibility studies, financial projections, due diligence, litigation support, legislative issue support, and gaming industry expert witness services for the gaming industry.

Wells has fifteen years experience as a senior executive in the casino-hotel industry with Holiday Inns, Harrah’s, and Bally’s. Wells has also held positions in management, planning, and financial analysis for a large regional bank and a major international oil company.

Wells has a B.S. degree in business from Oklahoma State University and completed a post- graduate program in Systems Dynamics at M.I.T. Wells has participated in a wide range of community service activities and is listed in Marquis Who’s Who in Finance and Industry and Marquis Who's Who in America.

May 2008 Wells Gaming Research Page 6-8 Kansas Casino Market Study & Gaming Revenue Projections

Wells Gaming Research Client List (Current and/or Prior Customers)

Aladdin Gaming, LLC: GEM, LLC ~ Reno, Nevada Aladdin Resort & Casino ~ Las Vegas, Nevada Harrah's Casino Hotel ~ Lake Tahoe, Nevada Ameristar Casinos, Inc. ~ Las Vegas, Nevada Harrah's Casino Hotel ~ Laughlin, Nevada Alamo Travel Center ~ Sparks, Nevada Harrah's Hotel Casino ~ Reno, Nevada Aristocrat Technologies, Inc. ~ Las Vegas, Nevada Harrah's Hotel Casino ~ Tunica, Mississippi Arizona Charlie's Casino Hotel ~ Las Vegas, Nevada Hollywood Casino ~ Tunica, Mississippi Arizona Charlie's East Casino Hotel ~ Las Vegas, Nevada Horseshoe Casino & Hotel ~ Bossier City, Louisiana Avi Resort & Casino ~ Laughlin, Nevada Innovative Gaming Corporation of America Baldini's Sports Casino ~ Reno, Nevada International Gaming Technology Bear Stearns Companies, Inc. Isle of Capri Casinos, Inc.: Binion's Horseshoe ~ Tunica, Mississippi Isle of Capri Casino ~ Bossier City, Louisiana Boyd Gaming Corporation: Isle of Capri Casino ~ Biloxi, Mississippi California Hotel & Casino ~ Las Vegas, Nevada Isle of Capri Casino - Lula, Mississippi Fremont Hotel & Casino ~ Las Vegas, Nevada Isle of Capri Casino - Vicksburg, Mississippi Main Street Station Hotel Casino ~ Las Vegas, Nevada Isleta Casino & Resort - Albuquerque, New Mexico Sam's Town Hotel & Gambling Hall ~ Las Vegas, NV ITT Sheraton Gaming Division Sam's Town Tunica Hotel & Gambling Hall ~ Tunica, MS John Ascuaga's Nugget ~ Reno, Nevada Stardust Resort & Casino ~ Las Vegas, Nevada Lady Luck Hotel Casino ~ Las Vegas, Nevada Bronco Billy's Sports Bar & Casino ~ Cripple Creek, CO Little Creek Casino ~ Shelton, Washington Caesars Palace Hotel & Casino ~ Las Vegas, Nevada Majestic Star Casinos: Cannery Casino Hotel ~ Las Vegas, Nevada Fitzgeralds Hotel Casino ~ Las Vegas, Nevada Clay County Gaming Initiative, Inc. ~ Clay Co, Iowa Fitzgeralds Hotel Casino ~ Tunica, Mississippi Club Cal-Neva/Virginian Hotel Casino ~ Reno, Nevada Mandalay Resort Group: Coast Hotel & Casinos, Inc.: Circus Circus Hotel Casino ~ Reno, Nevada Gold Coast Hotel Casino ~ Las Vegas, Nevada Circus Circus Hotel Resort & Casino ~ Las Vegas, NV Suncoast Hotel & Casino ~ Las Vegas, Nevada Colorado Belle Hotel & Casino ~ Laughlin, Nevada The Orleans Hotel & Casino ~ Las Vegas, Nevada Edgewater Hotel & Casino ~ Laughlin, Nevada Copa Casino ~ Gulfport, Mississippi Excalibur Resort Hotel & Casino ~ Las Vegas, Nevada DRKW - Grantchester, Inc. ~ New York, New York Gold Strike Casino & Resort ~ Tunica, Mississippi Eldorado Hotel Casino ~ Reno, Nevada Luxor Resort Hotel & Casino ~ Las Vegas, Nevada Fallon Paiute-Shoshone Tribe ~ Fallon, Nevada Mandalay Bay Resort & Casino ~ Las Vegas, Nevada Fidelity Investments ~ Boston Monte Carlo Resort & Casino ~ Las Vegas, Nevada Fitzgeralds Hotel Casino ~ Reno, Nevada Silver City ~ Las Vegas, Nevada Four Queens Hotel Casino ~ Las Vegas, Nevada Silver Legacy Resort & Casino ~ Reno, Nevada Greenspun Corporation ~ Las Vegas, Nevada Slots-A-Fun ~ Las Vegas, Nevada Guild, Russell, Gallagher, & Fuller, LTD ~ Reno, Nevada Monarch Casino & Resort, Inc.: Galleria Associates ~ Henderson, Nevada Atlantis Casino Resort ~ Reno, Nevada Golden Phoenix Hotel Casino ~ Reno, Nevada

May 2008 Wells Gaming Research Page 6-9 Kansas Casino Market Study & Gaming Revenue Projections

Wells Gaming Research Client List (Continued) (Current and/or Prior Customers)

Mikhon Gaming Corporation Ramada Inn Speakeasy Casino ~ Reno, Nevada Nevada Resort Association ~ Las Vegas, Nevada Rampart Casino ~ Las Vegas, Nevada MGM • Mirage: Reno/Sparks Convention & Visitor’s Authority Beau Rivage Hotel & Casino ~ Biloxi, Mississippi Rio Suite Hotel Casino ~ Las Vegas, Nevada Bellagio Hotel & Casino ~ Las Vegas, Nevada River Palms Resort Casino ~ Laughlin, Nevada Golden Nugget Hotel & Casino ~ Laughlin, Nevada Riverside Resort Hotel Casino ~ Laughlin, Nevada MGM Grand Hotel Casino ~ Las Vegas, Nevada Riviera Hotel & Casino ~ Las Vegas, Nevada New York New York Hotel & Casino ~ Las Vegas, NV Sands Regency Hotel Casino ~ Reno, Nevada The Mirage Hotel & Casino ~ Las Vegas, Nevada Seven Circle Resorts, Inc. Treasure Island at the Mirage ~ Las Vegas, Nevada Sheraton Casino ~ Halifax, Novia Scotia Palms Casino Hotel ~ Las Vegas, Nevada Sheraton Hotel Casino ~ Tunica, Mississippi Park Place Entertainment: Showboat Hotel Casino ~ Las Vegas, Nevada Bally's Casino Las Vegas ~ Las Vegas, Nevada Si Redd's Oasis Hotel & Casino ~ Mesquite, Nevada Bally's Casino Tunica ~ Tunica, Mississippi Silicon Gaming, Inc. Flamingo Las Vegas ~ Las Vegas, Nevada Silver Club Hotel Casino ~ Sparks, Nevada Flamingo Laughlin ~ Laughlin, Nevada Silverton Hotel & Casino ~ Las Vegas, Nevada Grand Casino Biloxi ~ Biloxi, Mississippi Station Casinos, Inc.: Grand Casino Gulfport ~ Gulfport, Mississippi Boulder Station Hotel & Casino ~ Las Vegas, NV Grand Casino Tunica ~ Tunica, Mississippi Fiesta Henderson ~ Las Vegas, Nevada Las Vegas Hilton ~ Las Vegas, Nevada Fiesta Rancho Casino Hotel ~ Las Vegas, Nevada Oshea's ~ Las Vegas, Nevada Green Valley Ranch Resort & Spa ~ Las Vegas, NV Paris Las Vegas ~ Las Vegas, Nevada Palace Station Hotel & Casino ~ Las Vegas, Nevada Reno Hilton ~ Reno, Nevada Santa Fe Station Hotel Casino ~ Las Vegas, Nevada Sheraton Casino ~ Tunica, Mississippi Sunset Station Hotel & Casino ~ Las Vegas, Nevada Peppermill, Inc.: Texas Station Gambling Hall & Hotel ~ Las Vegas, NV Peppermill Hotel Casino ~ Reno, Nevada Stratosphere Casino Hotel & Tower ~ Las Vegas, Nevada Western Village Inn & Casino ~ Sparks, Nevada Terrible's Casino Hotel ~ Las Vegas, Nevada Penn National Gaming, Inc. Thunder Valley Casino ~ Lincoln, California Boomtown Casino ~ Biloxi, Mississippi Treasure Bay Casino Resort ~ Biloxi, Mississippi Casino Magic ~ Bay St. Louis, Mississippi Tropicana Hotel Casino ~ Las Vegas, Nevada Pinnacle Entertainment, Inc.: Tuscany Hotel & Casino ~ Las Vegas, Nevada Boomtown Hotel • Casino • RV Park ~ Reno, Nevada Venetian Resort Hotel Casino ~ Las Vegas, Nevada Casino Magic ~ Biloxi, Mississippi WMS Gaming Inc. ~ Waukegan, Illinois Boomtown Casino ~ Bossier City, Louisiana Wild Game NG: R&R Advertising Siena Hotel Spa & Casino ~ Reno, Nevada Rail City Casino ~ Sparks Wynne Resorts, LTD ~ Las Vegas, Nevada Ramada Express Hotel & Casino ~ Laughlin, Nevada Zeh Saint-Aubin Spoo ~ Reno, Nevada

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